When you come right down to it, the emirate of Abu Dhabi can be characterised from an economic point of view by three things – not enough local human capital, massive natural resources (read oil) and massive financial resources (read sovereign wealth funds).

These are the three main economic assets that need to be considered when the future strategy of Abu Dhabi is developed.

Some may protest that the beaches are also an asset, attracting tourists. The issues, from Abu Dhabi’s perspective, are that five months of the year the air is too hot and for another five months the water is too cold – leaving exactly two months of the year when the beaches can be considered a tourist attraction. The second issue is that a tourist industry pales in comparison to the size of the natural and financial assets.

Any other economic endeavour, excluding social and civil projects such as health or education, would have to be built from scratch in the middle of the desert, with a large deficit of human capital which needs to be expensively imported.

I believe that there is a saying about not reinventing the wheel. It would be good to heed such a saying.

My aim here is not to criticise current economic initiatives but to suggest alternatives. Progress depends on considering ideas that may conflict with current ones.

Some initiatives, such as the Louvre, might not make commercial sense as a tourist attraction, ie its return on investment is low or negative, but the government might decide that the image it gives Abu Dhabi or the increased attraction it creates for expats to move make sense and are therefore worth the price. This is a policy decision and governments make them all the time.

The problematic issue is pure commercial decisions. Let us use a crude example. Let us say that the emirate of Abu Dhabi, hypothetically speaking, decided to build a factory in Abu Dhabi that built smartphones based on their analysis that smartphone demand was increasing globally.

So we have a good analysis, but why build a factory, let alone a factory in Abu Dhabi? What are the competitive advantages of such a strategy? We do not have an industry that builds the phone parts, so we would have to ship them from afar, costing more money. Samsung and Apple clearly dominate the market, how could the Abu Dhabi venture grab market share? You get the idea.

Given our resources, there does not seem to be a way to grow the local economy in a sustainable manner other than via government expenditure driven by oil income.

The answer is to think outside the box. An economy is conventionally thought of as capital plus labour producing goods and services. Our Achilles heel is labour. We do not have much of it and, however much we import, it is dwarfed by oil and financial resources.

Once we see that labour is our weak spot it becomes immediately clear that capital is the only possible solution. Historically this capital came from oil sales, but oil is a depleting asset. Financial assets, managed properly, are an accretive asset.

The astute reader might point out that there is nothing new here as sovereign wealth funds exist to deploy assets and manage them. The difference is that the SWFs are, by and large, purely silent financial investors. What I am talking about is an active investor.

It seems contradictory that at home we expect our people to build and operate businesses with little to no natural advantage and yet abroad we tell our people not to get involved. Yes, foreign governments can fear such large investments, but the answer is not to hide, it is to show them that you are a great active partner to have.

This can be done by managing fear and greed. Fear is managed by world-class corporate governance and transparency of motive. Greed is managed by deploying world-class employees who can create operational value.

In essence, as oil reserves dwindle the emirate should export goods in the form of capital, and services in the form of operational value creation. This would require two things. First, Emiratis need to be trained not just to invest in companies but also to manage them. The second requirement is that Abu Dhabi change its policy from that of a passive investor to an active, value-creating one.

This article was originally published in The National.