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Future Proofing Abu Dhabi’s Economy: The Masdar Project
Background Note
The United Arab Emirates (UAE) is a federation of seven emirates situated in the Arabian Peninsula. As of 2013, Abu Dhabi was the largest and most oil rich emirate of the UAE contributing to 10 percent of oil reserves and 4 percent of natural gas reserves in the world. Since the 1960s, the main engine for Abu Dhabi’s economic development was the hydrocarbons industry. The economy was heavily dependent on its vast oil and gas reserves. Due to its huge reliance on fossil fuels, the UAE had the highest ecological footprint per capita in the world. The growth in population also led to increased usage of hydrocarbons, resulting in Green House Gas (GHG) emissions. |
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The UAE and Abu Dhabi realized that economic growth based on fossil fuels was unsustainable in the long run due to depletion of fossil fuel reserves and growing concern about climate change. Hence it decided to diversify its economy. In 2002, as a first step toward economic diversification, the Abu Dhabi government set up the Mubadala Development Company (Mubadala) as a public joint stock company with Sheikh Mohamed Bin Zayed Al Nahyan, Abu Dhabi’s Crown Prince and Deputy Supreme Commander of the Armed Forces, as the Chairman of the Board of Directors.
