Tourism and Trade in Dubai Drive GDP Increase
The economy of Dubai grew faster than expected last year, expanding by 3.4 percent. Dubai Statistics Centre executive director Arif Obaid Al Muhairi stated that Dh 10bn was added to the economy in 2011, pushing the GDP to DH 306.2bn as a result of boosting trade and tourism.
The emirate’s economic future for 2012 is forecasted to continue on the path to growth, with a 10 percent increase in visitors expected for the coming year.
Dubai Supreme Fiscal Committee chairman Shaikh Ahmad bin Saeed Al Maktoum forecasted up to 5 percent growth for this year, resulting from strategic plans to promote diversification and opportunities. Early analysis put the 2011 growth in Dubai at about 3 percent.
Data from the DSFC showed that positive growth occurred in non-hydrocarbon industries, with trade moving forward in 2011 with almost 5.8 percent growth.
GDP growth was complemented by sharp increases in Dubai exports, which surged by almost 44.3 percent last year. Manufacturing rose by 11.7 percent, increasing the GDP by 1.5 percent.
Communications and transportation both recorded growth of 2.7 percent, while the restaurant and hotel industries grew by almost 13.9 percent as a result of growth in several hotels. Revenue from the 575 hotels located in Dubai reached DH 16bn in 2011, a 20 percent increase. There were 5 percent more hotel rooms and apartments in 2011, including 53,828 hotel rooms and 21,015 flats.
The IMF reported that the UAE economy continues to recover, in spite of uncertainty in the global economy. High prices and increased production in oil last year, as well as robust growth across Asia, helped to bolster the UAE’s status as a safe haven and resulted in estimated growth of 4.9 percent for UAE real GDP .
The FGCCI (or Federation of GCC Chambers of Commerce and Industry) forecasted that the GDP would continue to increase, reaching a record-high of about $385bn (current prices) this year and holding on as the second largest Arab economy behind Saudi Arabia.
The UAE would then account for over 20 percent of the combined GCC GDP, expected to reach a record-high of about $1.46 trillion in 2012, according to the FGCCI. Real GDP growth of 4.6 percent is forecasted for 2012, equalling about 7 percent in current prices.
Kuwaiti GDP Set to Grow 3 Percent in 2012
Forecasts for Kuwait report substantial GDP growth and 4.8 percent rise in inflation for 2012. GDP growth in Kuwait is expected to fall behind rates of growth in Qatar, Oman and Saudi Arabia, based on figures from a recent B of A Merrill Lynch Global Research report.
The study noted that GDP growth in Kuwait will reach 3 percent this year, with growth in Qatar expected to hit 6.1 percent and growth in Saudi Arabia and Oman set to reach 5 and 3.3 percent, respectively.
Growth in the UAE is forecasted at the same levels as Kuwait, with growth in Bahrain reaching 2.3 percent.
The report also contained warnings about the CPI (or Consumer Price Index) in Kuwait, which is expected to increase by 4.8 percent this year. Bahrain will experience the lowest levels of inflation, with a 1 percent CPI increase, while Saudi Arabia is expected to report a 5 percent rate of inflation. Inflation in Qatar should reach 1.9 percent, and UAE is forecasted to report inflation at 1.3 percent.
In terms of the global economy, the recent study stated that fears over Greece exiting the European Union continue to influence markets.
China’s GDP growth is forecasted at 8 percent for the coming year, while growth in India is forecasted at 6.7 percent. Brazil is expected to experience 2.8 percent growth, a drop from last year’s GDP increase of 3.4 percent.
According to the study, the policies of some nations have offered support and declines in interest rates have resulted from tumbling EM exchange rates.
The report includes recommendations to policymakers, urging them to gauge where the recent softness has stemmed from, consider the restrained performance of important EM economies and think about the Euro flu, as well as other factors nearby.
Economic Growth of 3.5 Percent Expected in Bahrain
Bahrain is forecasted to grow by 3.5 percent in 2012 and 4.1 percent in 2013, according to a report by Standard and Poor.
The S&P report stated that FDI (or foreign direct investment) volumes in Bahrain have hit $300 million, with more financial services companies operating there in 2011, in spite of regional unrest. In 2011 there were 414 financial services firms working in Bahrain, up from 401.
Bahrain’s economy suffered limited damage after the turmoil, partially thanks to efforts by the nation’s government to attract higher levels of FDI.
Economic stimulus launched by the Bahraini government included $300 million allocated for infrastructure and $550 million allocated for 50,000 housing units located around the nation.Paul Holdsworth, Staff Writer, Gulf Jobs Market News