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72210
Sun, 07/26/2009 - 16:08
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Real GDP grew 7.4% in 2008
The UAE economy grew by about 7.4 per cent in real terms in 2008 despite a sharp decline in oil prices in the second half of the year because of the global financial downturn, said the Central Bank yesterday according to a report in Emirates Business 24|7.
Releasing its annual report for 2008, the bank said the high growth was a result of strong oil prices in the first half of 2008 and steps taken by the government in the second half to counter the impact of the crisis.
The rate was higher than the 5.3 per cent real growth recorded in 2007 but far lower than the 11.6 per cent rate in 2006. "The UAE was affected by the global financial crisis but it recorded a good growth rate of about 7.4 per cent last year," it said.
"The high growth was a result of a surge in crude prices in the first half of the year and the measures taken by the Central Bank and the Ministry of Finance to ensure sufficient liquidity for the banking sector."
The report gave no figures on the gross domestic product but in nominal terms, it was estimated at about Dh929.4 billion in 2008, an increase of about Dh200bn over the 2007 GDP of Dh729.7bn.
This means the country's nominal GDP jumped by a staggering 27.4 per cent in 2008. Earlier estimates by the Ministry of Economy showed the real GDP stood at about Dh535.6bn in 2008 compared with Dh498.7bn in 2007.
The Central Bank did not give any forecasts about this year's economic performance but forecasts by the IMF and other institutions showed the GDP would sharply slow down and could contract in real terms.
According to the Saudi American Bank Group (Samba), the UAE economy could shrink by about one per cent, while the Abu Dhabi-based Arab Monetary Fund expected a real growth of three to four per cent this year.
Samba said it has based its forecasts on a sharp decline in the oil sector because of lower prices and a large cut in the UAE's crude output in line with Organisation of Petroleum Exporting Countries' collective deal to trim supplies to prop up prices.
Its estimates show the UAE's oil economy will dive by 11.9 per cent in 2009 but the non-oil sector could still grow by about 2.3 per cent.
"In 2010, the UAE economy will rebound into growth of about 2.9 per cent as both the oil and non-oil sector will record growth," said Samba.
Turning to inflation, the Central Bank said the rate swelled to a record 12.3 per cent in 2008 from about 11.1 per cent in 2007.
While providing no projections for 2009, Samba and other institutions expect inflation in the UAE this year to dive to its lowest level of one per cent in 15 years as a result of lower rents, a sharp fall in food prices and a stronger US dollar. –
Releasing its annual report for 2008, the bank said the high growth was a result of strong oil prices in the first half of 2008 and steps taken by the government in the second half to counter the impact of the crisis.
The rate was higher than the 5.3 per cent real growth recorded in 2007 but far lower than the 11.6 per cent rate in 2006. "The UAE was affected by the global financial crisis but it recorded a good growth rate of about 7.4 per cent last year," it said.
"The high growth was a result of a surge in crude prices in the first half of the year and the measures taken by the Central Bank and the Ministry of Finance to ensure sufficient liquidity for the banking sector."
The report gave no figures on the gross domestic product but in nominal terms, it was estimated at about Dh929.4 billion in 2008, an increase of about Dh200bn over the 2007 GDP of Dh729.7bn.
This means the country's nominal GDP jumped by a staggering 27.4 per cent in 2008. Earlier estimates by the Ministry of Economy showed the real GDP stood at about Dh535.6bn in 2008 compared with Dh498.7bn in 2007.
The Central Bank did not give any forecasts about this year's economic performance but forecasts by the IMF and other institutions showed the GDP would sharply slow down and could contract in real terms.
According to the Saudi American Bank Group (Samba), the UAE economy could shrink by about one per cent, while the Abu Dhabi-based Arab Monetary Fund expected a real growth of three to four per cent this year.
Samba said it has based its forecasts on a sharp decline in the oil sector because of lower prices and a large cut in the UAE's crude output in line with Organisation of Petroleum Exporting Countries' collective deal to trim supplies to prop up prices.
Its estimates show the UAE's oil economy will dive by 11.9 per cent in 2009 but the non-oil sector could still grow by about 2.3 per cent.
"In 2010, the UAE economy will rebound into growth of about 2.9 per cent as both the oil and non-oil sector will record growth," said Samba.
Turning to inflation, the Central Bank said the rate swelled to a record 12.3 per cent in 2008 from about 11.1 per cent in 2007.
While providing no projections for 2009, Samba and other institutions expect inflation in the UAE this year to dive to its lowest level of one per cent in 15 years as a result of lower rents, a sharp fall in food prices and a stronger US dollar. –
