Oil Wealth
It is amazing how much time and energy we all spend recognizing and celebrating wealth. But even more amazing is how poor the information about real wealth is: Warren Buffet and Bill Gates may be worth $50 billion each, but compared to some they are pikers.
The United Arab Emirates, a state on the Arabian Peninsula that faces the Persian Gulf, is an oil state with the second or third largest reserves of oil in the world at 100 billion barrels. The state is made up of seven Emirates with about 4.5 million residents, but only 20% are locals, or Emiratis. The rest are expats - Brits and Aussies on the make, Pakistanis and Indians building everything, Filipinos and Thai working as nurses and maids and Russian women, well, you know...
The UAE is one of the more forward thinking of the Arab states and has one of the fastest growing, most vibrant economic cities in the world in Dubai. The state has a president, a vice president, a prime minister and two vice prime ministers, and two councils. The public actually elects half of the ministers of one of the councils (its a start). In the spirit of a traditional sheikhdom though, the President and Vice President have veto power over everything the government does. The ruling sheikh, Sheikh Khalifa, is The Man. What he says, goes. Period. He happens to be the ruler of the Emirate of Abu Dhabi, the Emirate with most of the oil.
Over the years, Adu Dhabi has built an investment fund from their oil wealth worth an estimated $850 billion. They pump about 2.5 million barrels per day generating about $55 billion in state income at current prices. In ten years, at $60 oil and assuming a modest 6% return, this account will have around $2 trillion, plus or minus a few sand castles, or 20 times Bill and Warren's money combined. All controlled by one man, and his fifteen wifes, and thirty girlfriends...
It is amazing how much time and energy we all spend recognizing and celebrating wealth. But even more amazing is how poor the information about real wealth is: Warren Buffet and Bill Gates may be worth $50 billion each, but compared to some they are pikers.
The United Arab Emirates, a state on the Arabian Peninsula that faces the Persian Gulf, is an oil state with the second or third largest reserves of oil in the world at 100 billion barrels. The state is made up of seven Emirates with about 4.5 million residents, but only 20% are locals, or Emiratis. The rest are expats - Brits and Aussies on the make, Pakistanis and Indians building everything, Filipinos and Thai working as nurses and maids and Russian women, well, you know...
The UAE is one of the more forward thinking of the Arab states and has one of the fastest growing, most vibrant economic cities in the world in Dubai. The state has a president, a vice president, a prime minister and two vice prime ministers, and two councils. The public actually elects half of the ministers of one of the councils (its a start). In the spirit of a traditional sheikhdom though, the President and Vice President have veto power over everything the government does. The ruling sheikh, Sheikh Khalifa, is The Man. What he says, goes. Period. He happens to be the ruler of the Emirate of Abu Dhabi, the Emirate with most of the oil.
Over the years, Adu Dhabi has built an investment fund from their oil wealth worth an estimated $850 billion. They pump about 2.5 million barrels per day generating about $55 billion in state income at current prices. In ten years, at $60 oil and assuming a modest 6% return, this account will have around $2 trillion, plus or minus a few sand castles, or 20 times Bill and Warren's money combined. All controlled by one man, and his fifteen wifes, and thirty girlfriends...
posted by Lionel at 1:04 AM
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