The UAE is aiming for a 25 per cent growth in the industry portion of the nation’s economy. The plan to increase this sector of their Dh 1 trillion economy is in line with the goal to shrink UAE’s dependence on oil and was reported by a senior government official.
Currently the country’s industry sector contributes 16.2 per cent of the UAE’s GDP. The Minister of the Economy’s Undersecretary Mohammed Al Shihhi stated that the nation has a goal to boost the industry portion to 25 per cent.
The third largest oil producing nation in the world, UAE has a major diversification push underway to shrink their dependency on oil. Currently oil contributes only 29 per cent of the UAE’s gross domestic product, leaving the non-oil sector accounting for 71 per cent. This number has increased from 66.5 per cent back in 2008.
Growth is evident in the UAE as the worldwide financial crisis calms and real GDP growth hits 2.5 per cent, according to Al Shihhi.
He commented that the nation is now beginning the next phase of economic growth.
The International Money Fund increased this year’s growth forecast for the UAE earlier in October. Sitting at 1.3 per cent in May, the IMF now expects to see 2.4 per cent growth this year expanding to 3.2 per cent next year.
The Minister of Economy Sultan bin Saeed Al Mansouri stated that the nation has been able to ride through the crisis thanks to the diversification policies within the nation’s economy. Focusing on trade, service, logistics, financial services, tourism and industry has been instrumental in the 1.3 per cent growth seen in last year’s GDP.
Billions have been spent on aluminium, petrochemical and power plants in an effort to create growth within industry.
The EIU (Economist Intelligence Unit) noted that the UAE economy is moving steadily towards reaching a record high of Dh 1 trillion this year and will continue rising next year as oil prices remain high.
Both the EIU and the Ministry of Economy in the UAE expect growth of the GDP to reach 2.5 per cent.
The EIU forecasts economic growth of 15 per cent next year, reaching Dh 1.15 trillion due to crude prices that are expected to rise even higher than current levels.
September’s Global Focus from the Standard Chartered Bank noted that growth in the UAE is caused by both oil and non-oil industries. Since the oil sector accounts for almost 30 per cent of the economy, rising oil prices and steady production will help that sector contribute to even more growth this year.
The Global Focus also stated that the non-oil sector is experiencing positive moves as well. Trade is up in Dubai and along with wholesale, makes up almost 40 per cent of the GDP in Dubai. Non-oil trade in the region rose by 18 per cent (measured annually) in the first six months of this year, reaching $76 billion.Paul Holdsworth, Staff Writer, Gulf Jobs Market News