Abu Dhabi's GDP will fall short of government growth targets this year as officials prepare the latest phase of the capital's expansion strategy.
Abu Dhabi's economy set to expand this year - but short of official hopes
Abu Dhabi's economy is expected to expand by 4.5 per cent this year, short of government growth targets. The 2030 Economic Vision plans the emirate to grow by between 6 and 7 per cent to meet Abu Dhabi's goals.
"Growth will be 4.5 per cent this year but we will review growth in the first half of the year after six months," said Mohammed Abdullah (CK), undersecretary of Abu Dhabi's Department of Economic Development (DED). Although Abu Dhabi does not release annual GDP data, growth prospects have improved this year.
The outlook has brightened as the emirate has stepped up oil production to offset lost Libyan supplies. Activity in the tourism, retail and industrial sectors have also picked up.
The 2030 vision is divided into five-year plans to help fine tune longer-term growth targets. Preparations are already underway for forming the latest plan, which starts in 2012.
"As far as 2030 is concerned, there is no change," said Mr Abdullah. "Of course, we are going to update the five-year economic plan for next year and take into consideration all the factors around us."
Upgrading the regulatory and legal environment as well as supporting the private sector and SMEs has been a focus of the current five-year plan.
The vision, developed during the regional boom and released in November 2008, is the blueprint for the emirate's long-term effort to diversify away from oil.
The impact of the global financial crisis, prompted Abu Dhabi to reassess some goals in its 2030 Economic Vision, according to a government-guaranteed bond prospectus released last year.
The changes reflected slower economic and population growth. Mr Abdullah said he expected consumer price inflation in the capital to reach 3 per cent this year. Inflation in the emirate eased to 1.9 per cent on an annual basis in March.
Rises in food and transports prices had been the biggest drivers of inflation in recent months. Recent inflation rates are widely viewed as manageable, unlike the pre-crisis years of 2007 and 2008 when rates topped 10 per cent.
"Inflation is controllable and we have a mechanism to deal with the situation," he said.