UAE provides highest level of material wellbeing to residents in Arab world: UN report
The UAE provides the highest level of material well-being to its residents in the Arab region followed by Kuwait and Qatar, according to a UN report.
According to the United Nations Economic and Social Commission for Western Asia (ESCWA), the other Arab countries that made it to the top list for material well-being were Saudi Arabia, Bahrain, Oman, Egypt and Tunisia under purchasing power parity (PPP)-based per capita GDP and per capita actual individual consumption (AIC).
While GDP per capita is often used to depict the average standard of living in a country, AIC per capita provides a better capture of the material well-being of people within the economy.
The material well-being takes into account physical, mental and financial health of the residents.
Majed Skaini, International Comparison Programme regional programme manager for the Arab region at ESCWA and author of the report, said although Qatar ranked as the richest Arab country, it came only third in terms of material well-being of residents, measured through actual individual consumption per capita (AIC).
'The highest level of material well-being in the Arab region was scored by the UAE, which ranked 24th worldwide, followed by Kuwait in the 37th place and Qatar in the 38th,' he added.
While GDP per capita is often used to depict the average standard of living in a country, AIC per capita is a widely used measure to assess the average material well-being of people within an economy.
Skaini underscored that PPPs were used to conduct comparative economic analysis to gain more insights into industry competitiveness, investment opportunities, and government decisions on subsidies, taxation and other fiscal instruments. 'PPPs are also used in measures related to health, energy, education and the environment,' he added.
AIC per capita shows purchasing power standards (PPS) and it includes all goods and services that households use, irrespective of whether they were purchased and paid for by households directly, by government, or by nonprofit organisations. It can be considered as an indicator of the material welfare of households.
The UAE's high ranking in material well-being could be attributed to numerous factors including mandatory health insurance across the country, the Involuntary Loss of Employment scheme to provide a certain degree of protection for individuals, and end-of-service benefit initiatives introduced for the private sector workers in Dubai to secure their financial future.
Importantly, residents of the UAE and other oil-producing Gulf countries enjoy strong buying power due to their high per capita income, which is one of the highest in the world.
According to the United Nations Economic and Social Commission for Western Asia (ESCWA) entitled 'Real sizes of Arab economies between 2017 and 2023,' per capita AIC in PPP terms shows that although Qatar was the richest country in the region, it did not have the highest level of well-being.
From the perspective of consumers, Qatar is the most expensive Arab country, followed by the UAE and Kuwait. Syria continued to be the least expensive Arab country. Egypt and the Sudan are second and third least expensive, respectively.
According to the UN ESCWA report, t he Arab economy accounts for nearly 5 per cent of the world global gross domestic product (GDP), with Egypt and Saudi Arabia ranking among the 20 biggest economies worldwide and contributing with 27 per cent and 24 per cent, respectively, to the regional economy.
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