x Abu Dhabi, UAEFriday 28 July 2017

Economic expansion on the fast track

Abu Dhabi's economy is expected to grow by 3.9 per cent this year before picking up next year, senior officials say.

Abu Dhabi Economic Vision 2030 aims to cut reliance on oil and expand the contribution of sectors such as tourism to the economy. Ravindranath K / The National
Abu Dhabi Economic Vision 2030 aims to cut reliance on oil and expand the contribution of sectors such as tourism to the economy. Ravindranath K / The National

Abu Dhabi's economy is expected to grow by 3.9 per cent this year before picking up next year, senior officials say.

Expansion will reach 5.7 per cent between next year and 2016, the Abu Dhabi Department of Economic Development estimated yesterday.

The forecasts, the first by the Government for such an extended period, come as the euro-zone crisis and a slowdown in China batter the global economy.

"We have considered all the information about the global financial crisis and that might continue," said Mohammed Omar Abdullah, the department's undersecretary. "We included certain elements that might affect growth."

Abu Dhabi does not regularly release official GDP growth forecasts. Under the Abu Dhabi Economic Vision 2030, officials had targeted an annual growth rate of 6 to 7 per cent.

The Abu Dhabi Economic Outlook Report 2012-2016 signals the emirate may fall slightly short of those goals. Yet the overarching aim of the 2030 vision, to steer Abu Dhabi's economy away from oil, remains intact officials say.

The goal is to cut the emirate's reliance on oil to 36 per cent of GDP by 2030.

"It's a long-term march and throughout that march we plan to make the non-oil sector a bigger contributor to GDP than oil," said Mr Abdullah. "We do look at certain areas that impact on GDP."

The GDP forecasts would be reviewed annually and changed if the outlook worsened, said Mr Abdullah.

Growth estimates for this year were slightly lower than forecast by National Bank of Abu Dhabi.

"In terms of oil output, my sense is that oil output increased this year so there should be a good, strong contribution from the oil sector this year," said Giyas Gokkent, the chief economist of National Bank of Abu Dhabi.

tarnold@thenational.ae