Growth will be propelled by an expansion of non-oil sectors and a rising population, says the capital's Chamber of Commerce and Industry.
Abu Dhabi economy to accelerate next year
Abu Dhabi's economic growth will accelerate next year with the expansion of non-oil sectors expected to drive the creation of wealth in the capital, says the Abu Dhabi Chamber of Commerce and Industry.
Growth will be propelled by a more expansive private sector and a rising population, according to a report by the chamber.
Development in non-oil industries such as manufacturing, construction, trade and services will eclipse growth in the oil sector, the biggest component of the emirate's economy.
Next year would bring resumptions in projects hit by delays and budget cuts this year, said Shady Shaher, the MENA economist at Standard Chartered.
Mohamed Rashid al Hameli, the director general of the chamber, said: "The private sector in Abu Dhabi has understood its role in the Abu Dhabi economic vision 2030 and is in the process of contributing more and more to the overall development of the emirate".
Abu Dhabi's GDP will grow 3.8 per cent next year compared with last year to reach Dh567.3 billion (US$154.44bn) in constant prices, which take into account inflation, said the report.
It said it expected the emirate's non-oil sector to record faster growth, expanding 5.1 per cent compared with last year to reach Dh258.5bn.
The report did not include a forecast for overall growth this year. The IMF in May predicted growth of 3.7 per cent this year for Abu Dhabi.
The outlook for the capital's economy next year is similar to other big oil producers in the region such as Saudi Arabia, analysts say. But it is still far short of original targets set by the emirate as part of the capital's Plan Abu Dhabi 2030.
Unveiling the plans at the start of last year, officials said annual growth needed to be between 6 per cent and 7 per cent to achieve the emirate's goals.
"It's better to have sustainable rates of growth than volatile rates that are tied to the price of oil," said Mr Shaher.
"Investment in non-oil projects will be paramount to Abu Dhabi achieving it's goal of 64 per cent non-oil GDP by 2030."
Non-oil sectors such as manufacturing, property and trade currently account for more than 45 per cent of the emirate's economy.
The report said it expected Abu Dhabi's population to rise 6.2 per cent to 2.93 million next year.
It forecast the number of workers in production sectors to rise 5 per cent to 608,900 next year, while the numbers of those within the services sector would increase 6 per cent to 881,600.
Overall, the workforce is projected to increase 5.2 per cent to 1.49 million.
The report forecast exports would increase by 9.4 per cent next year compared with this year, and imports by 8 per cent.