UAE Inc positive about the economy

A year after the onset of the global financial crisis, an increasing number of companies in the country are exuding a heightened sense of confidence toward the economy and are more optimistic about the future, according to an Emirates Business economic outlook survey.

Contrary to some global economists who are predicting a W-shaped recovery, 64 per cent of the respondents from the 25 companies surveyed by this paper believe the long-term prospects of the economy look bright, with government, health, education, and utility sectors leading the charge in 2010.

"We remain confident about the long-term outlook for the UAE and the Gulf financial sector as the benefits of regulatory intervention and monetary policy are felt across the banking industry and further ease liquidity constraints," said Zeeshan Saleem, Consumer Banking Director at Barclays UAE and GCC.

Dr Giyas Gokkent, Chief Economist at National Bank of Abu Dhabi, said: "With regards to forecasts for 2010, Abu Dhabi should still carry the UAE for a bounce in activity resulting in single digit growth in 2010."

Many UAE companies are also looking to increase their investments in the so-called "new world" and some of them are even looking to invest across the border, the survey reveals.

The majority (56 per cent) of senior executives from the 25 polled firms in the country plan to increase their investments next year.

Thirty-six per cent of respondents maintain that negative global developments could adversely impact the UAE, which can lead to a short-term dip in confidence.

Consumers will remain wary for a while, which will impact the economy directly, said some. "The UAE is only replicating what is happening elsewhere," said an official at a credit firm.

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