x Abu Dhabi, UAETuesday 25 July 2017

Higher crude prices help to lift Abu Dhabi's GDP

Higher oil prices helped to generate an extra Dh186bn for the Abu Dhabi economy last year. The emirate's nominal GDP, which strips out inflation, also swelled by almost 30 per cent.

Last year, oil accounted for 58.5 per cent of Abu Dhabi's GDP, according to the report. Courtesy Adnoc
Last year, oil accounted for 58.5 per cent of Abu Dhabi's GDP, according to the report. Courtesy Adnoc

Higher oil prices helped to generate an extra Dh186bn (US$50.64bn) for the Abu Dhabi economy last year.

The emirate's nominal GDP, which strips out inflation, swelled by almost 30 per cent to Dh806bn last year. The Statistics Centre-Abu Dhabi (Scad) did not release the real GDP figure, but the rise mirrors similarly robust oil-fuelled gains in the Saudi economy.

"It's a very similar picture," said Jarmo Kotilaine, the chief economist of National Commercial Bank in Saudi Arabia. "If you look at the preliminary 2011 data, the nominal GDP [in Saudi Arabia] grew by 28.2 per cent. They provided the real number as well, which was 6.8 per cent."

The Scad report said the "robust growth presents unequivocal proof" that the emirate's economy has rebounded from the global financial crisis.

The figure was boosted by "huge financial surpluses, strong growth in non-oil sectors and activities, high oil prices, along with several other factors", according to the report. Non-oil activities grew by about 7 per cent throughout the year, it added.

The diversification of the emirate's economy away from its reliance on oil is one of the key objectives of Abu Dhabi Economic Vision 2030.

The road map seeks to reduce the emirate's reliance on oil to 36 per cent of GDP by 2030. Last year, oil accounted for 58.5 per cent of Abu Dhabi's GDP, according to the report.

"This confirms that the emirate's plans to expand the economic base and diversify the sources of income are progressing successfully," said the report.

But "mining and quarrying activity", dominated by oil extraction, grew by more than 53 per cent, "fuelled by the sharp rise in oil prices in world markets", added the report.

Mr Kotilaine says that although Abu Dhabi's real GDP growth figure is not known, the picture is "somewhat better" than expected.

"Presumably, [the real GDP growth figure is] something quite close to the Saudi number, which certainly would point to a rebound in economic activity from the post-crisis situation, and that certainly goes beyond the oil sector," he said.

 

gduncan@thenational.ae