UAE 2011 GDP seen at Dh1.25trn

The UAE’s GDP is expected to peak at Dh1.248 trillion in current prices this year to maintain its position as the largest in the Arab world after Saudi Arabia’s economy, according to an official study.

The expected level this year will be nearly 198 times the country’s nominal gross domestic product of Dh6.5 billion when it was established in 1971, the Dubai Economic Council said in the study, dubbed “the document of the union era.”

Real GDP is forecast to grow by around 3.3 per cent in 2011 and 3.8 per cent in 2012compared with around 2.3 per cent in 2010, the report said.

It showed the nominal GDP has raced by nearly 34 per cent annually over the past five years because of strong oil prices, pushing the country’s per capita income to a projected Dh174,000 from Dh100,000.

Although the UAE has remained heavily reliant on oil exports for its income, the hydrocarbon sector’s contribution to GDP has sharply declined over the years because of a massive drive to diversify the economy. From around 70 per cent in 1971, its contribution slumped to only 29 per cent in 2010, the report showed.

Non-oil GDP hit an all-time high of around Dh749bn in 2010 compared with nearly Dh511bn in 2006, it said.

“This development reflects the UAE’s efforts to ease reliance on the oil sector given its price volatility and persistent instability in the global economy.”

The report showed the UAE’s fiscal balance would record a surplus of 10.3 per cent of GDP this year and 9.2 per cent in 2012 against seven per cent in 2010.

As for trade, it showed the country’s commercial exchange would rocket by nearly133 times from around Dh13bn in 1971 to a projected Dh1.73trn in 2011. In 2010, the UAE was ranked the 13th largest exporter with exports of around $235 billion while it came 18th in imports which stood at $170bn, the report said, adding that the country’s exports and imports accounted for almost two and 1.4 per cent of the world’s total exports and imports respectively.

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