UAE leads Arab countries in 2016 Global Innovation Index

This year’s Global Innovation Index measured the performance of 128 countries and economies in the area of innovation which represents the majority of the global workforce and global GDP. The index is based on 82 sub-indices which measure innovation in detail and provide a clear understanding of how it drives economic growth and prosperity. 

The index results attributed the outstanding progress of the UAE this year to its sustainable achievements in innovation inputs, especially the strengthening of institutions and market sophistication. The UAE has one of the best political and legislative environments in the world along with outstanding development in information technology, communications, infrastructure, and innovation linkages. 

Sultan bin Saeed Al Mansouri, Minister of Economy, said that the remarkable progress made by the UAE on the index in leading Arab countries and elevating its global ranking adds to its impressive track record of comprehensive development witnessed under the leadership of President His Highness Sheikh Khalifa bin Zayed Al Nahyan, Vice President and Prime Minister and Ruler of Dubai His Highness Sheikh Mohammed bin Rashid Al Maktoum, and His Highness Sheikh Mohamed bin Zayed Al Nahyan, Crown Prince of Abu Dhabi and Deputy Supreme Commander of the UAE Armed Forces. 

The minister added that innovation is a major pillar in advancing the state’s economic development and is at the heart of good government policies aimed at placing the UAE among the top 10 countries in the world on the index by the Golden Jubilee of the Union, in line with UAE Vision 2021. 

Al Mansouri emphasised that the outcome of the index, which has further strengthened the UAE’s regional leadership, is consistent with the innovation-related trends and efforts exerted by the state, particularly over the past few years. Innovation has become an integral part of the successful performance and competitiveness of the UAE, in terms of both public and private sector activities. 

He added that these efforts culminated in the launching of the National Strategy for Innovation in 2014 which was followed by the declaration of 2015 as ‘The Year of Innovation’ in the UAE under the directives of the UAE President. 

The index sub-indices showed that the country ranked first globally in the cost of redundancy dismissal, ease of paying taxes, tertiary inbound mobility and state of cluster development. 

Progress in innovation inputs also included a significant improvement in market sophistication thanks to growth in investment and credit. Investments have gone up from a rank of 105 to 55, thanks to market capitalisation that increased from a rank of 73 to 32 as well as total value of stock traded that has gone up from a rank of 51 to 20 and VC deals that went up from 48 to 34. 

It should also be noted that patent families went up from rank 93 to rank 68, gross expenditure on R&D from rank 63 to rank 48 and knowledge workers have increased from a rank of 57 to 25 increasing the overall innovation input contribution of the UAE. 

The value of stocks traded rose from 4.7 percent of GDP in 2015 to 35.9 percent in this year's index. Market capitalisation also rose from 18.2 percent of GDP to 50.5 percent. The domestic credit to the private sector rose from 59.1 percent of GDP to 65.4 percent. 

In the business sophistication indices, the R&D performed by business rose from 0.1 percent of GDP to 0.5 percent, while the R&D financed by business is ranked 4th in the world. 

The report said that one of the main contributors to the overall progress made by the UAE on the index this year is the robust improvement in the outputs sub-index across a number of important sectors. 

Knowledge and technology outputs went up from 134 to 86. This dimension includes knowledge diffusion that has increased from 137 to 53 rank thanks among others to significant changes in FDI net outflows. 

Across the creativity outputs index, the country achieved a rise in the number of trademark registration applications at the national level from 9.3 to 11.3 per billion USD GDP.