The Department of Planning and Economy of Abu Dhabi yesterday released its annual economic and social development report for 2007, which reported growth in all sectors in the emirate, with forecasts of future stability.

While releasing the Abu Dhabi Social and Economic Report 2008, which covered all indicators from 2002 to 2007, Butti Ahmed Mohammed Al Qubaisi, Executive Director of the department, said the emirate would report a further rise in its growth rate by the end of this year.

"Despite the global economic meltdown, Abu Dhabi Emirate has maintained a stable economy with growth in all sectors over the past several years. This report is an encouraging forecast for this year and years to come. The report shows we can control the inflation and we are on the right track. It will be controlled this year and in future with the continuity of growth and achievements in social development," Al Qubaisi said.

He said in the past five years Abu Dhabi's economy has experienced its most robust and longest lasting upturn ever "as a result of higher oil prices on world markets, which had a favourable impact on the emirate's various economic sectors". As a result, these sectors have lately been growing at an average rate of 18 per cent, he said.

Al Qubaisi said the structural reforms being implemented for three years now have strengthened steady expansions in non-oil sectors, and there is consensus among analysts that Abu Dhabi is expected to achieve steady growth above the current rate in 2008 and through the coming years.

"This is based on the size of mega-projects currently being implemented by the emirate, and the government's restructuring projects which have begun to bear fruit," he said.

According to the report, the emirate has allocated investments of up to $20 billion (Dh74 bn) to raise its oil production capacity to 3.5 million bpd by 2010, up from 2.7m bpd at present – since oil is still the main engine that will continue to power rapid economic growth, not only in Abu Dhabi but also all over the UAE. The report also shows that Dh12bn was invested in the industrial sector last year.

The revenues of oil and gas and derivatives account for about 35 per cent of the GDP, 80 per cent of government revenue and 90 per cent of total exports, the report suggests.

Al Qubaisi said the report was the first important set of indicators for all sectors and segments of the emirate. From oil and gas production and industrial growth, its coverage extends to developments in the health and education sectors in the last five years.

"The report is divided into two sections – economy and human resources – and will be posted on the department's website both in Arabic and English. We are already working on this year's report, which will be released at the beginning of 2009. We are collecting data from various departments and organisations, including international agencies, for the report," he added.

The official said the UAE's GDP for the year 2007 was estimated at about Dh687.7bn, showing an average growth rate of 26.5 per cent over the period from 2004 to 2007. According to the report and its preliminary estimates, Abu Dhabi emirate's GDP (including oil and gas) grew to Dh400bn last year, up from Dh147bn in 2002, with an average growth rate of 21.8 per cent.

The non-oil GDP, according to the report, was Dh159bn last year compared to about Dh85bn in 2002. Al Qubaisi attributed this to Abu Dhabi's growing revenues from oil as a result of higher oil prices throughout 2007.

"As I said, despite the global economic meltdown, the real GDP growth of the emirate this year will not be less than 11 per cent against the nominal GDP growth of 18 per cent," he said.

A breakdown of the GDP shows that in 2007 the relative importance of commodity activities reached 78.4 per cent, compared with 21.6 per cent for the service activities. The report also shows the growth in the relative importance of the output of commodity activities surged from 67.7 per cent in 2002 to 78.4 per cent in 2007.

The report further details the growth in the country's gross fixed capital formation, which reached Dh136.8bn last year, posting an average growth rate of 21 per cent. The emirate ranked first in the UAE with Dh57.785bn or 42 per cent of the total fixed capital formation last year, followed by Dubai (39 per cent) and Sharjah (10 per cent).

The report shows manufacturing industries top the list in terms of total investments, which amounted to 21.1 per cent in 2007, compared with 16.7 per cent for extractive industries in the same year.

Prominent among service activities in 2007 were real estate and business services – at 16.0 per cent – and transportation, storage and communications, which were 11.5 per cent.

The volume of foreign investments grew from Dh16.17bn in 2006 to Dh17.81bn last year. "However, direct foreign investment, which is instrumental in the support and diversification of the national economic base, remains low relatively to the emirate's aspirations and resources: Abu Dhabi attracts only 24 per cent of foreign investments in the country, while it contributes some 58 per cent of the federal GDP," the report said.

The report showed commodity imports rose to Dh63.347bn last year, an increase of Dh40.8bn against the 2002 figure (Dh22.534bn). In 2006, the figure was at Dh45.698bn.

The report also said in 2007 the population of the emirate grew to 1,530,424 from 1,213,478 in 2002 – an average annual growth of 4.8 per cent during the period measured.

 

The numbers

Dh74bn: is the investement Abu Dhabi has allocated to raise its oil production capacity to 3.5 million bpd by 2010.

Dh688bn: is the UAE's GDP for the year 2007, showing an average growth rate of 26.5 per cent over the period from 2004 to 2007.