Semester:Spring 15Assignment Date:25/3/15

Course Code:ECON 206Course Name:Global Economy

Assessment:AssignmentDuration:Submit by 12/4/15 (In hard and soft copy both)

Student Name:Rafal raad

Hamda HalimStudent ID:BBA1321719

BBA1412074

Awarded Mark:Total Mark:15

Course Learning Outcome Contribution

CLO 1CLO 2CLO 3CLO 4CLO 5CLO 6CLO 7

Max Mark--

Awarded

1. Take any two countries of world like UAE and USA and analyse any latest trade relation may be restriction or lifting ban between them focusing on1) Apply the aggregate demand and supply theories in both the countries because of the trade relation. (CLO3 ( 7 marks)The United Statesand theUAEenjoy asignificanttradeandinvestmentrelation,the majority ofit has littledirectrelationtoUAEoilexports.And its one of thefastest growing USA economic partnerships,bothgloballyand particularlyin theGCCregion.TheUAEis definitely one of the mostopeneconomiesaround the world, And also its dynamiceconomic , This relationship showstheUAEspositionas aregionalleaderin terms of economic transform, and opennesstointernationaltradeandinvestment,andpoliticalstability.In the year 2012,theUAEandUSformanEconomicPolicyDialogue(E.P.D.),which willperform platformto developing uniqueinitiativesthat arecreated tostrengthentheeconomic, tradingandcommercialpartnerships}between the twocountries.

The UAE and the USA established on May / 2007 of aUS - UAE Business Council , demonstrate on expanding the commercial relationships .Also in 2012,theUAEwasthemajorexportmarketsin the MiddleEastfor theUSA.From2011to2012,the entire tradingvolumebetween theUnited Arab Emiratesandunited states of Americaincreased to more than$24.5billion, growthfrom$16.8in year2011.and was sustainedbyriseinexportsfrom the USA to UAE.TotalexportsfromUStoUAEreach$22.billion,a 38%raise more than the year 2011.ImportsintoUSfromUAEstayed balancedatover$2billion.Also UAE has trade relation withevery states in the US, as well with Columbia and Virgin Island. Also there is a strong relation between both countries as the united Arab emirates pegs its currency UAE dirham ( AED) to the US( $ dollar).over 1000 US organization have a presence in united Arab emirates, like Bechtel and ExxonMobil , Starbucks also Cold Stone Creamery and many others .As a result of valuableinvestmentin the USA for more30 years,UAEhas being adependablealsolong-termcontributor toUSoverall economy supplying market liquidity tounited states of America capitalmarket,and a growingfor UScompaniesalso safety work placefor USworker ,as we asUAEmakingsignificant investmentsin the USthatspanall overdifferent industries such as manufacturing,informations technology and financial service,real estates , aviations market .in the same time ,USbusinesses progressively making apresencein theUAEwith more than 800 hundredcurrently established many firms,not only in order to servicethedomestic current market, but as well asto benefitfrom the UAE sstrategicposition which allowsaccess tomore than 3 billion consumers in this region .In a similar way theoverall economyof the UAE flourishsince it continues is continuing toserve as a strategiccenterfor leading US companies in banking, retail, finance, consulting, and defense and education sectors. As the UAEnational economy is continuing to expanding 2) Evaluate their fiscal or monetary policy due to trade relation (CLO 4 (8 marks)

As per the strong relationship between the two countries UAE use monetary policy with USA as we know the united Arab emirates pegs its currency UAE dirham ( AED) to the US( $ dollar). Definitely thecentral bank of UAEinjectsDirhamliquidityin situations whenabankrequireaccess toDirham.Swaparranging containa associated withsaleandforwardspurchasing Us dollarsagainst thepurchase forwardssaleof equal value ofDirhamamountfor afixtermatspecific rate .The maindutiesof theCentralBankis andynamic expansionarypolicythat is committed to generating the preferredeconomicgoals withstableratesTheCentralBankis alsoworking to{maintainingfixedexchangerateof thedirham AEDagainst theU.S.$ dollarand toguarantee the free of costconvertibilityof thenationalcurrencyintoforeign currency, and additionally to its own taskas"BankofBanks"andGovernment'sbankand its{financial consultant . in the same time the most efficient countries in term of governments fiscal policy as we know the open market of UAE with USA for exporting and importing many services and goods and huge investments in different sectors like infrastructure and aviation all this with the terms of fiscal policy .References.:http://usuaebusiness.org/initiatives/commercial-trade/

http://www.uaetrade-usa.org/082411.pdf

http://dalmacapital.com/commentary&id=926&title=The%20Effects%20of%20US%20Monetary%20Policy%20on%20UAE%20Investors%20and%20Borrowers