Abu Dhabi's GDP grows 6.8 percent in real terms in 2011: SCAD

Abu Dhabi, Oct 15, 2012 (WAM) - Statistics Centre - Abu Dhabi (SCAD) released yesterday preliminary data that Abu Dhabi GDP at constant prices grew from Dh 567.8 billion in 2007 to Dh 606.6 billion in 2011, achieving an annual growth rate of 6.8 percent. These results demonstrate that the emirate's economy has bounced to levels above those that dominated prior to the global financial crisis, giving it a huge competitive advantage and boosting its appeal to local and foreign investors. The report shows the first figures of the GDP at constant prices, along with the key developments in Abu Dhabi economy over the past few years. These are the first detailed figures confirming that the Emirate's economy has evidently overcome the repercussions of the global financial crises, as detailed data point to significant growth in real terms across all activities and sectors, both oil and non-oil. Growth in the GDP at constant prices during 2011 surpassed all the forecasts and estimates made by local and international parties. Statistics Centre - Abu Dhabi had announced in August the GDP at current prices, which refers to the value of total economic output measured in prevailing in the market prices. Abu Dhabi's GDP's at current prices for 2011 amounted to Dh 806 billion, marking an annual growth of 29.9 percent. However, market prices are prone to constant upward and downward changes. Therefore, the GDP in real terms does not reflect actual economic developments, necessitating the use of GDP at constant or real prices, which adjust nominal value for price changes and, accordingly, reflects the actual developments in output of goods and services, excluding any impact of price changes. According to SCAD, Abu Dhabi's GDP at constant prices (for the base year 2007) grew by 63 percent over the past decade, rising from Dh 372.1 billion in 2001 to Dh 606.6 billion in 2011. The economic performance in the course of the past ten years tells the success story of Abu Dhabi in harnessing natural resources to serve a sustainable development process and ensure that the people enjoy one of the highest living standards in the world. The per capita GDP has increased proportionally with this development, reaching Dh 286,000 in 2011 (at constant prices for the base year 2007), the second highest GDP per capita in the world. However, this economic success story is only one aspect of providing a decent living for citizens and expatriates, which would not have been possible without the progress that has been achieved in other walks of life. This achievement can be attributed to the economic policies pursued by the Emirate, which aim to diversify sources of income by diversifying the economic base. Non-oil sectors now contribute the largest share of the GDP. The impressive economic growth experienced by the Emirate of Abu Dhabi in recent years has been characterised by the rapid growth of the non-oil economy, with the pace of moving away from dependence on oil being the fastest in the region. According to SCAD, this robust growth at constant prices presents unequivocal proof that the Emirate of Abu Dhabi has fully recovered from the impacts of the global economic crisis, with data indicating record net gains of Dh 38.78 billion (at 2007 price) during the year 2011, which saw the GDP at constant prices grow to Dh 606.06 billion, up from Dh 567.8 billion in 2010. This remarkable growth was also manifest in the real GDP per capita, which advanced in 2011 to Dh 286,000 at constant 2007prices. Supported by its remarkable resilience, huge financial surpluses, strong growth in non-oil sectors and activities, high oil prices, along with several other factors, the economy of the emirate was fast to overcome the consequences of the global financial crisis, regain stability and, interestingly, achieve some benefits from the crisis. For instance, inflation retreated to only 1.9 percent during 2011. In addition, the crisis gave impetus to non-oil activities, which achieved a strong growth rate during 2011. A thorough review of the economy of the Emirate of Abu Dhabi would confirm that it has made vast strides and achieved a high level of development and diversity in a short span of time, making continuous gains under a wise management that learns from past experience in its endeavour to take best advantage of available opportunities. This is reflected in the fast-paced economic progress the Emirate has experienced over the past years, in the course of which major projects were undertaken, translating a practical vision and an insightful outlook on the future. This impressive growth enhanced the attractiveness of the national economy to investors worldwide and established the Emirate as a hub for concluding major business deals. In recent years Abu Dhabi economy has advanced in leaps and bounds towards the establishment of a solid infrastructure, founded on economic diversity and comprehensive development. It has emerged as the most dynamic economy in the region, breaking through from an economy depending almost entirely on public spending, which is directly affected by fluctuating oil revenues, to a diversified economy that has evolved into regional financial, commercial and tourist centre. Despite the importance of oil to the economy of Abu Dhabi, the Emirate pursues an ambitious strategy to expand and diversify the economy in order to fortify it against volatile oil prices. In this regard, it can be seen from the figures announced by SCAD that oil accounted for only 52.4 percent of Abu Dhabi GDP in 2011 at 2007 prices, confirming that the Emirate's plans to expand the economic base and diversify the sources of income are progressing successfully, in line with the government's efforts to achieve the Abu Dhabi Economic Vision 2030. On the other hand, the figures released by SCAD yesterday show that non-oil activities contributed approximately 47.6 percent of the emirate's real GDP in 2011, achieving a relatively high real growth rate of 4.1 percent at constant prices for the base year 2007. A glance at historical trends shows that the output of non-oil activities at constant prices (base year 2007) has doubled 2.07 times over the past decade, growing from Dh 139844 million in 2001 to Dh 288845 million in 2011, making such activities a major contributor to the Emirate's economy. The aforesaid developments in the real output of non-oil sectors attest to the success of the Emirate's programs to expand the economic base and diversify the sources of income. In parallel with this, the private sector has achieved impressive growth and gained numerous competitive advantages in the fields of production and exports, enabling it to play a more effective future role in facing up to the economic uncertainty on the horizon, both regionally and internationally. Therefore, particular attention is paid to empowering the private sector and expanding its role in the diversification process to create the investment climate conducive economic development. SCAD's recently released preliminary data on the GDP of the Emirate of Abu Dhabi at constant prices (base year 2007) indicate that most economic activities and sectors achieved positive growth in real terms at varying degrees in 2011, most notably the transport, storage and communications activity, which grew by 12.5 percent, restaurants and hotels (up 11.4 percent), real estate (up 10.9 percent), manufacturing (up 9.8 percent), mining and quarrying (up 9.4 percent), health and social services (up 7.5 percent) and education (up 5.2 percent). Real growth for other non-oil activities ranged from 1.0 percent for construction to 3.5 percent for wholesale and retail trade. During the past three years prices in the Emirate Abu Dhabi have been markedly stable. Annual inflation remained below 3.1 percent. The Emirate's inflation rate had hit an all-time high of 14.9 percent in 2008, but bounced to the lowest level ever (0.8 percent) in the following year, responding to a set of direct measures taken by the Government of Abu Dhabi stabilise prices on the one hand, and also as one of the favourable outcomes of the global financial crisis. In 2011 the inflation stood at 1.9 per cent. – Emirates News Agency, WAM