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Emirates TravelUAE guide / UAE politics

Politics in the UAE

The United Arab Emirates formed a federation in 1971
The United Arab Emirates formed a federation in 1971. The seven emirates that make up the UAE vary greatly in geography, natural resources, wealth, and population. When the federation was formed in 1971, the entire UAE population was only 180,000. The population today is estimated to be almost 3 million.

When the UAE was formed, there were also great differences in the development of the seven emirates. Dubai and Abu Dhabi in the western part of the federation were already exporting oil by 1971, whereas on the eastern coast, Fujairah was not connected by road to the rest of the country due to its mountainous terrain.

The government of the UAE tries to balance the traditions of the tribes that make up the population with efforts to modernize and attract business partners from around the world. The powers of the federation include responsibility for:
  • Labor relations
  • Banking
  • Nationality and Immigration
  • Defense
  • Security
  • Education
  • Currency
  • Public Health
  • Designation of territorial waters
  • Extradition policies
  • Postal service
  • Foreign affairs
  • Telephone service
  • Communications
  • Licensing of Aircraft
  • Air Traffic Control
The powers not specifically dedicated to the federation belong to the individual Emirates, according to Articles 116 and 122 of the Constitution of the United Arab Emirates.

Parts of the federation government include the Supreme Council, a parliamentary body, and an independent court system, which includes the Federal Supreme Court.

Each of the seven emirates is ruled by a sheikh, who is the leader of the most powerful tribe in the emirate. Each of the seven emirate rulers is a member of the Supreme Council, which is the group that creates national policy. The leader of the largest emirate, Abu Dhabi, serves as the President of the UAE, and the leader of the second largest, Dubai, serves as Prime Minister and Vice President of the UAE.

The Supreme Council’s functions are defined in the constitution as formulation of general policies, legislation, ratification of treaties, and appointment of Supreme Court judges. Most issues require a simple majority to carry, but occasionally very important issues will require a two-thirds majority, or five of the seven members of the Supreme Council. Two of those five members must be Dubai and Abu Dhabi.

The parliamentary body is called the Federal National Council, or FNC, and is made up of 40 representatives drawn from the emirates based on their population. Dubai and Abu Dhabi each have eight representatives, while Sharjah and Ras al-Khaimah have six, and Ajman, Umm al-Quwain, and Fujairah each have four. Half of the representatives are elected, and the other half are appointed by emirate rulers.

The FNC’s main duty is crafting of the annual budget. The UAE constitution says that each emirate must give half its annual revenues to the federal government. However, in reality, Abu Dhabi, which has the greatest oil reserves, usually covers 60 to 90% of the federal budget of the UAE. Dubai and revenues of the various UAE ministries general cover the rest of the federal government.

The federal government of the UAE is mainly funded by the 20% surcharge paid by foreign banks on their profits. Foreign oil companies also pay taxes and royalties, and there is a 4% customs duty on all imports except tobacco and alcoholic beverages, which pay duties of 25% to 50%. Some 75% of the items imported into the UAE pay no duties at all, and all exports are duty free. In recent years, the UAE government has run annual budget deficits of between US$7 billion and US$8 billion. However, the UAE has over US$150 billion in international investments, and they cover the deficits. The UAE provides a birth to death social welfare system, and there are no income taxes or consumption taxes in the UAE.

Each of the individual emirates has its own local government. The ruling sheikh basically maintains his authority based on loyalty of the people of the emirate. The rulers are required to have frequent open majlis, or council meetings where the ruler’s tribesmen can discuss their concerned. Each individual tribe in an emirate and some of the tribes’ subsections will also have a sheikh.

Abu Dhabi is further divided into eastern and western municipalities, with the cities of Al Ain and Abu Dhabi governing their own municipal areas. The UAE does not have the kind of political parties that western nations have. Members of the FNC are chosen from each emirate based on the emirate’s population, and a speaker, who presides over the Council, is elected by the FNC.

The government of the UAE in 2007 began a forward-looking strategy of how the federation will effectively cope with social and economic development, justice, infrastructure, and development of rural areas. Abu Dhabi also launched its own policy to make the government more modern. Abu Dhabi will be examining how to best address the needs of the economy, tourism, health, culture, planning, the role of women, and legislative reform. The UAE’s goal with the modernization strategies is to keep the federation carefully balanced between ancient tradition and modern commerce, as they have done for over 35 years.

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