The UAE has emerged as one of the most stable countries and a safe haven for business despite the current political unrest in the Middle East and North Africa, a senior economy official said on Tuesday.
Abu Dhabi, the UAE’s main oil producer, is set to play a key role in regional financial activities as it is pushing ahead with economic diversification to ease reliance on volatile crude exports, said Mohammed Omar Abdullah, undersecretary of the Abu Dhabi Department of Economic Development.
His figures showed the emirate attracted nearly $2.7 billion in direct foreign investment last year despite the global slowdown and that it was classified as the second most attractive city for FDI in 2010.
Given the regional challenges and widening instability, the UAE emerges as one of the most stable countries, and a safe haven for investment, with a key role to play in business and finance in the region,” he told a conference in the capital.
“Abu Dhabi in particular, offers considerable advantages for both local and international investors, with its strategic geographic location, highly developed infrastructure, facilities provided by the Emirate’s free zones and industrial cities, very low tax, easy access to energy sources and credit facilities, etc.”
He said the “vast and favorable” opportunities which Abu Dhabi offers with its inviting business environment would augment local business, attract more foreign investments, improve value added and increase non-oil exports
Abdullah noted that despite the significant decline in global FDI levels over the past two years, due to the impacts of the world financial crisis, the “Financial Times" report on “FDI prospects -2011” ranked Abu Dhabi as the second most attractive city for FDI in the Middle East in 2010, with total investments amounting to about $ 2.7 Billion.
Investment statistics for 2010 showed that the total number of registered businesses in Abu Dhabi exceeded 96,000 establishments of which 10.4% were new licensed businesses, compared to 86,000 establishments in 2009 of which 14.7% were new licensed businesses, he said.
“The growth achieved by the economy of Abu Dhabi in 2010 proves that the Emirate has fully surpassed the repercussions of the global economic crisis, as GDP at current prices grew by 16% to mark Dh 620 billion.”
Abdullah said all economic activities picked off at varying positive growth rates in 2010, most notably the mining and quarrying activity, which grew by 29%, fuelled by the rise in oil prices, in addition to the increase in Abu Dhabi oil production.
Furthermore, non-oil activities registered positive growth rates around 5.5% in average, he said, adding that the financial sector recorded the highest rate among non-oil activities achieving14.5%. Manufacturing activity grew by
about 11% and the real estate and business services by 6.5%.
he said that although oil is important to the economy of Abu Dhabi, but its contribution to GDP, still is less than 50% for the second year in a row, as its share in GDP accounted for only 49.7% in 2010.
“This confirms that the Emirate’s strategy to expand its economic base and diversify its sources of income progresses successfully in line with ‘The Economic Vision 2030’….all this demonstrates the flexibility and strength of the emirate’s economy, as well as the success of the stimulus policies tracked by the government to revive its economy, spur growth, and boost the emirate status, as the favorable investment destination in the Middle East region,” he said.
“In addition, the economy of Abu Dhabi offers a spectrum of multiple investment opportunities in fields of industry, renewable energy, real estate, and infrastructure, to mention a few.”
He said Abu Dhabi is currently investing heavily in building a world class integrated infrastructure, and best in class connectivity to accommodate the growth within the region, and to service export markets.
“The government commitment to continuing infrastructure spending on construction and upgrading road networks, ports, hospitals, schools, housing projects, industrial zones and other development projects across the Emirate, will sustain the activity of local businesses, and advance the status of its economy as one of the leading economies; not only in the gulf region but in the Middle East.”