UAE Approves Strategy to Double Contribution of Digital Economy to GDP Within 10 Years

 Sheikh Mohammed bin Rashid chairing a cabinet session on Monday, April 11, 2022. (WAM)
Sheikh Mohammed bin Rashid chairing a cabinet session on Monday, April 11, 2022. (WAM)
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UAE Approves Strategy to Double Contribution of Digital Economy to GDP Within 10 Years

 Sheikh Mohammed bin Rashid chairing a cabinet session on Monday, April 11, 2022. (WAM)
Sheikh Mohammed bin Rashid chairing a cabinet session on Monday, April 11, 2022. (WAM)

The UAE cabinet on Monday approved a digital economy strategy to double the contribution of the digital economy to the GDP from 9.7% to 19.4% within the next 10 years. It also aims to transfer the UAE into a hub for digital economy regionally and globally.

The strategy includes more than 30 initiatives and programs targeting six sectors and five new areas of growth.

It will define the digital economy in the country, with a unified mechanism for measuring its growth while measuring its indicators periodically.

The strategy will define the priorities of digital economy in the country, ensuring the contribution of all other economic sectors to promote and support the digital economy.

Sheikh Mohammed bin Rashid Al Maktoum, Vice President, Prime Minister and Ruler of Dubai, said: “Our goal is to increase the contribution of the digital economy sector to the non-oil GDP by 20 percent over the next 10 years.”

“We formed a Council for Digital Economy chaired by Omar bin Sultan al-Olama, the UAE Minister of State for Artificial Intelligence, Digital Economy, and Teleworking Applications,” he added.

The cabinet also approved a federal law about the public finance. It compels federal authorities to coordinate with the Ministry of Finance to achieve the financial strategy’s objectives.

It approved executive regulation of the federal decree-law on private education aimed at regulating the work of private schools in the country, in accordance with the objectives of the private education law, the provisions of which apply to all private schools in the UAE.

The executive regulation aims to enhance a high-level educational system that regulates the licensing mechanism for private schools, to ensure the quality of education and to place students among the best in the world in knowledge assessment tests.

The cabinet further adopted a unified framework to coordinate and organize the humanitarian and development work of the charitable institutions.

It includes a guide that organizes the seasonal work of all UAE donors concerned with foreign aids, in accordance with international standards, and in line with the UAE foreign aid policy and strategy.

This framework includes the establishment of coordinating offices in the country's missions abroad for foreign aid.

It will contribute to regulating financial transfers to donors, and the UAE charitable institutions in the beneficiary countries.

In addition to reviewing and discussing several reports, the cabinet approved an agreement to linking payment systems among GCC countries, an agreement with Brazil, two agreements with Denmark and an agreement with the United States.



Global Debt Marches to Record High, Reaches $318 Trillion

One dollar bills are put in packaging bands during production at the Bureau of Engraving and Printing in Washington November 14, 2014. (Reuters)  
One dollar bills are put in packaging bands during production at the Bureau of Engraving and Printing in Washington November 14, 2014. (Reuters)  
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Global Debt Marches to Record High, Reaches $318 Trillion

One dollar bills are put in packaging bands during production at the Bureau of Engraving and Printing in Washington November 14, 2014. (Reuters)  
One dollar bills are put in packaging bands during production at the Bureau of Engraving and Printing in Washington November 14, 2014. (Reuters)  

The global debt-to-GDP ratio rose for the first time since 2020 last year, as the world's debt stock hit a new year-end record of $318 trillion and economic growth slowed, an Institute of International Finance report showed on Tuesday.

The $7 trillion rise in global debt was less than half of the 2023 increase, when expectations of Federal Reserve interest rate cuts sparked a borrowing surge.

The IIF warned, however, that so-called bond vigilantes could punish governments if rising fiscal deficits persist, reported Reuters.

“The increasing scrutiny of fiscal balances — particularly in countries with highly polarized political landscapes — has been a defining feature of recent years,” the IIF said.

Market reactions to fiscal policies in the United Kingdom brought down the short-lived tenure of Prime Minister Liz Truss in 2022, while similar pressures in France ousted Prime Minister Michel Barnier last year.

Debt-to-GDP - an indicator on the ability to repay debt - approached 328%, a 1.5 percentage point increase, as government debt levels of $95 trillion clashed with slowing inflation and economic growth.

The IIF said it expects debt growth to slow this year, amid unprecedented global economic policy uncertainty and still-elevated borrowing costs.

It warned, though, that despite high borrowing costs and economic policy uncertainty, its forecast of a $5 trillion increase in government debt this year could rise due to calls for fiscal stimulus and larger military spending in Europe.

Emerging markets accounted for roughly 65% of global debt growth last year.

This borrowing, along with a record $8.2 trillion in debt which emerging markets need to roll over this year - 10% of it in foreign currency - could strain countries' abilities to weather looming political and economic storms.

“Heightened trade tensions and the Trump administration's decision to freeze US foreign aid, including cuts to USAID, could trigger significant liquidity challenges and curb the ability to roll over and access to FX debt,” the report said.

It added that, “This underscores the increasing importance of domestic revenue mobilization to build resilience against external shocks.”