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The tourism industry should achieve average annual growth of 7.5 per cent up to 2016, the Abu Dhabi Government says. Ravindranath K / The National
The tourism industry should achieve average annual growth of 7.5 per cent up to 2016, the Abu Dhabi Government says. Ravindranath K / The National

Abu Dhabi keeps a firm grip on diversity ambition

Oil revenues helped put Abu Dhabi on the global map. In the coming decades, officials hope to broaden the mix of the economy.

Industry, construction, financial services, tourism and education are among the sectors being focused on in the capital.

The Abu Dhabi Economic Outlook report, released by the Abu Dhabi Department of Economic Development yesterday, offers a perspective on how those industries could develop in the coming years.

The report follows plans set out under Abu Dhabi's Economic Vision 2030, which would cut the emirate's reliance on oil to 36 per cent of GDP by 2030.

"The opening of the port, the railway that's being built and the gas production facility all point to an increase in the non-oil sector," said Giyas Gokkent, the chief economist of National Bank of Abu Dhabi.

"The real estate aspect of the Abu Dhabi 2030 vision is being phased out and they will see how the real estate sector is faring before committing to more projects."

The sectors:

Industry: From the sprawling port and manufacturing cluster taking shape on the edge of the highway to Dubai, to the industrial zone under way in Al Ruwais, Abu Dhabiís industrial footprint is expanding.

The sector is forecast to grow by 5.2 per cent this year, before accelerating at an average rate of 7.1 per cent between next year and 2016, Added estimates.

Khalifa Industrial Zone Abu Dhabi and the Al Ruwais industrial zone are key to the expansion.

Abu Dhabi is focusing on industries such as petrochemicals and plastics, as well as those that take advantage of its geographic advantage at the axis between Asia, Europe and Africa, such as logistics and food.

Construction: The capitalís cityscape has undergone a dramatic shift from low-slung villas and dusty expanses to rows of gleaming towers and smart new office complexes in recent years.

But as the skyline starts to take shape, the rate of expansion is expected to slow. Between 2005 and 2010, the construction sector expanded by an average of 20.4 per cent annually, Added estimates. But between this year and 2016, growth will ease to 11 per cent, it says. Still, an impressive array of mainly government-backed projects are expected to come online this year.

About US$4 billion (Dh14.69bn) of megaprojects will be finished this year, ranging from the Etihad Towers hotel and residences to Mubadala Healthcareís Abu Dhabi Cleveland Clinic on Al Maryah Island, formerly Sowwah Island.

Financial services: Abu Dhabi already has a sizeable presence in the financial services industry.

It is home to National Bank of Abu Dhabi, the countryís largest bank by assets, other large lenders and a clutch of sovereign wealth funds and other government investment vehicles sealing strategic deals around the world.

Yet Abu Dhabi has ambitions to further extend its financial services industry. The Al Maryah Island development started in 2007 to create the capitalís financial and business hub, centred on Sowwah Square, which will house the new home for the Abu Dhabi Securities Exchange.

The project, which is to include financial, residential, commercial and leisure developments on a 114-hectare site, is scheduled for completion in 2014. Reflecting the expansion, the Abu Dhabi Department of Economic Development (Added) forecasts financial services to swell by an average of 6.1 per cent each year until 2016.

Education: Zayed Universityís striking new Dh3.7bn campus is at the forefront of Abu Dhabiís drive to turn the capital into a world-class centre for education.

The campus in Khalifa City, which opened last September, was occupied by slightly fewer than 4,000 students in its first year, but is designed to cater for much higher numbers in the future. New York University Abu Dhabi and Paris-Sorbonne University Abu Dhabi are among foreign universities to have opened in the capital in recent years.

Within primary and secondary education, the outlook for the sector is equally bright. School enrolment in Abu Dhabi and Dubai is expected to grow by more than half by 2020, Booz & Co forecasts. Overall, the education sector is tipped to grow by an average of 7 per cent each year until 2016, Added estimates.

Tourism: After record numbers of tourists hit the capital last year, Abu Dhabi is banking on a similar stellar performance in the years ahead. The tourism industry should achieve average annual growth of 7.5 per cent up to 2016, Added estimates.

It is basing its projection on rising numbers of visitors flocking to the emirateís new hotels and other attractions. New hotels to have already hit the market this year include the Jumeirahat Etihad Towers and the Eastern Mangroves Hotel & Spa, which is being managed by the Thai operator Anantara.

tarnold@thenational.ae

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