Deficiencies in education and poor prospects for economic growth in the Gulf countries: The case of the UAE

Abstract

Abstract Our paper shows that the deficient educational system and the large share of unskilled foreign workers in the Gulf countries are serious impediments to a successful implementation of the strategies of these countries to reduce their dependence on foreign technologies and to restructure their economies in order to make them less dependent on oil exports. A novel element in our analysis is that we emphasise the role of the deficient educational system as an important problem, next to the well-documented quandary of a high incidence of unskilled foreign workers in the workforce. We use new survey data, both at an establishment level and economy-wide, to provide evidence on how the poor educational facilities lead to a poor provision of training, low skill levels, serious skills mismatch and deficient transfer of knowledge. These inadequate facilities and the lack of incentives to improve them also lead to low R&D efforts to promote local technologies and hamper a restructuring of the economy.