H.E/ Engineer Sultan Bin Saeed AL Mansouri, Minister of Economy Statement on Preliminary Indicators of the performance of the national Economy of the United Arab Emirates for 2008
H.E/ Engineer Sultan Bin Saeed AL Mansouri, Minister of Economy, confirmed that preliminary indicators of UAE economic performance during 2008 have shown that the effect of the international financial crisis on aggregate constituents of the national economy was relative and minimal.
H.E asserted that the national economy's blanket and the fast effective actions taken by the government have assisted to greater extent to regain balance for certain economic sectors, following the direct difficulties they have encountered as a result of the international financial crisis. Such sectors included construction, real estate, financial services and oil. The effective actions being adopted have helped as well to guide some of these sectors into curative and disciplinary processes which maybe beneficial in the long run.
H.E added that the performance of the national economy for 2008 has passed through two stages prior and after the financial crisis. The national economy, prior to the crisis has completed its accelerated growth, supported by high growth rates of oil prices, as the price of oil barrel has reached about 147 dollar in July 2008, and hence went through recess and reached its lowest level of 38.6 dollar in December 2008.
Preliminary data issued by the Central Statistics Department of the ministry, indicated that total Gross domestic product (GDP) at fixed price amounted to 535.6 billion dirham in 2008, at a growth rate of 7.4 per cent against 498.7 billion dirham, and a growth rate of 5.2 per cent in 2007, whereas the GDP at current price totaled to about 929.4 billion dirham in 2008 over 729.7 billion dirham in 2007.
A number of several factors have contributed to realization of the growth of the GDP, topped by the hike of oil prices, as average price of oil barrel has been estimated to about 94.5 dollar in 2008, compared with an average price of about 69.1 dollar for the barred in 2007, at a percentage increase of 36.8 per cent, which was positively been reflected on the growth of total GDP for 2008.
The value of contribution of non-oil sectors in the GDP has risen to reach about 577.5 billion dirham in 2008, over 467.9 dirham in 2007, whereas the percentage contribution of such sectors has decreased to about 62.1 per cent in 2008, compared with 64.1 per cent in 2007.
On the opposite side, percentage contribution of oil sector in total GDP has ascended from about 35.9 per cent in 2007 to 37.9 per cent in 2008 driven by the hike of oil revenue as a result of increase of prices of crude oil.
H.E affirmed that the rest of economic variables have continued their steady growth, whereby total fixed capital formation has increased to about 261.4 billion dirham during 2008, compared with 155.9 billion dirham in 2007, attaining a growth percentage of 67.8 per cent.
Final consumption expenditure amounted to 483.9 billion dirham in 2008 compared with 366.5 billion dirham in 2007 at a growth percentage of 32.0 per cent. Total exports of goods and services have enlarged to 746.7 billion in 2008, compared with 693.9 billion dirham in 2007, achieving a growth percentage of 7.6 per cent. Crude oil has constituted 36.2 per cent of commodity exports structure in 2008, whereby re-export comprised 38.8 per cent, free zones exports 11.2 per cent, oil by products 2.5 per cent, gas 4.5 per cent and other exports 6.8 per cent. On the other side, total imports of goods and services has increased to 562.6 billion dirham in 2008 compared with 545.3 billion and growth percentage of 3.2 per cent.
Preliminary data also indicates that, the country has acquired a surplus in its trade balance amounting to 184.1 billion dirham in 2008 over 148.6 billion dirham in 2007.
H.E expected that the national economy will start to overcome the effects of the financial crisis during 2009 in the presence of positive economic performance and emergence of signs of revival in financial markets during the second half of this year.
Infra structural projects are expected to continue to be executed, and the government will continue to maintain the increase in the level of its expenditure on projects, despite the decrease in oil revenues as a result of decline of international demand and reduction in production.
H.E anticipated that certain form of balance will prevail in financial markets, real-estate markets and construction sector.
The ministry of Economy's initiatives have formed the basis of support for the continuous growth of the UAE economy during 2008. Such initiatives have paved the way for achievement of accomplishments and positive results at the aggregate economic level.
This has helped to enhance the ability of the economy to meet local and external challenges, maintaining economic stability, suitability of environment for business, cooperation with all countries and world economic conglomerations and international organizations. The ministry has also made it one of its basic roles to drive maximum benefit from economic agreements signed with countries world-wide with the ultimate goal of enhancing growth and development.
The initiatives adopted by the ministry of economy have enhanced as well the competitiveness level of the UAE economy and its advanced position regionally and internationally, as a result of its conformity with existing economic developments in the country and world economic developments
The sound economic policies adopted by the country have lead to achieving excellent growth rates in various economic sectors, through development of the role of non-oil sectors in the components of the national economy.
The ministry has taken various necessary steps to ensure attainment of economic success in different sectors and maintaining continuous economic development in the future.
The year 2008, has witnessed the various endeavors taken by the ministry to promote the legal framework of the economic, investments and trade activities in the country, in addition to improvement of the competitive position of the country in the business area at both Arab and international levels. The ministry is currently working on reviewing many of other existing laws inorder to be compatible with the growing needs of the national economy and the increasing role of the private sector, in addition to the need for compatibility of such laws with the obligations of international competition.
H.E Sultan bin Saeed AL Mansouri, has issued a ministerial decision concerning working with the Unified Economic Activities Directory, in addition to unification of procedures and laws at the UAE level. The directory is a basic step in the Unified Commercial Register Project, which aims to provide a data-base about licensed economic sectors in the country, their volume and invested capital. Such data-base is entrusted to contribute to the proper and sound economic planning structure and formation of better view for updating and modernizing economic laws and legislations in the future.
The ministry, throughout 2008 has exerted various efforts to establish well-founded economic and commercial partnerships, and entering into free trade agreements with its strategic partners and major world economic conglomerations based on mutual benefits and attainment of joint interests emanating from UAE economic policies which are based on economic growth in various sectors, diversifying investments fields and increasing competitiveness of productive sectors through establishing strategic partnerships compatible with international trend in such respect.
The various initiatives, internal and external activities undertaken by the ministry have contributed to consolidation of the position of the UAE economy at the international level, as has been reflected by the indicators issued by international organizations throughout 2008. This has underlined the UAE keenness to implement the best international standards and adoption the best world practices in different fields which have succeeded to draw world appreciation and respect for UAE.
In this context the Technical Federal Institute of Zurich University classified UAE in the first position at the Arab world level, and in the 35th position internationally from among 122 countries as has been indicated in 2008 ranking report for the countries who have shown maximum integration in the world economy, based on 24 diversified economic and social criterion.
