Over the past two years Abu Dhabi’s economy has demonstrated considerable resilience and stability in the face of the global economic downturn, leaving it well placed for continued growth.
“If you look at the performance of the labour market and people who are employed, there has not been a recession of any sort,” Peter Crossman, the assistant director general for technical affairs at the Statistics Centre Abu Dhabi (SCAD), recently said. “The emirate has weathered the change in global economic and financial conditions.”
Crossman’s comments came during the recent release of SCAD’s “Abu Dhabi Statistical Yearbook – 2010”, which contains around 350 key indicators.
Covering economic growth, foreign trade, consumer prices, government finances, industrial activity and demography, the publication is a welcome step towards further economic transparency. Information on education, health, crime and culture are also highlighted within the research, as well as detailed figures on the labour force and agricultural sector.
Most of the data published was of a positive nature, despite the international financial crisis and subsequent global downturn.
“Supported by the emirate’s huge financial surpluses, Abu Dhabi’s economy was fast to recover, posting a growth of about 6% for non-oil activities during the last year, thus helping the UAE economy to regain its stability and overcome the repercussions of the financial crises,” a SCAD statement read.
One the most encouraging points that came out of the research was the growing number of business registrations, which rose from 62,991 in 2007 to 76,943 in 2009. A low unemployment rate of 3.25% in 2008 – the latest data available – was another reason for optimism.
While the overall unemployment figure is quite low, the jobless population rose from 28,573 in 2005 to 29,881 in 2008, 33.6% of whom were nationals and 27.3% were females. The largest portion of the unemployed (24.5%) is in the 20-24 age group, and this applies to nationals and non-nationals, males and females alike.
As always, oil receipts were another important area. Though Abu Dhabi’s nominal GDP did decline by 18% between 2008 and 2009 to Dh547bn ($148.92bn), most of that was due to lower crude prices. Globally, average oil prices decreased by 35% to $67 per barrel between 2008 and 2009.
Despite this decrease, however, the emirate still enjoyed one of the highest average GDP per capita rates in the world in 2009 – $90,517.
Meanwhile, fixed capital formation, which is a component of the expenditure on GDP, grew to $21.73bn, up from $19.79bn in 2008.
Foreign trade has also been on a steady rise over the past several years, with Abu Dhabi’s imports more than doubling from $9.58bn in 2005 to $25.56bn in 2009, according to the yearbook. Most goods came from the US, Germany, Saudi Arabia and Japan. Meanwhile the emirate exported 42.6% of its crude to Japan, 17% to Korea and 11.3% to Thailand.
Inflation dropped to a mere 0.78% in 2009 due to declining food, clothing and entertainment costs. With an inflation rate of 14.88% in 2008 most residents welcomed the respite. Between July and November of 2009 prices actually edged into a period of year-on-year deflation. SCAD’s building materials price index also declined by 7.7% in 2009, due to lower costs for cement, concrete and steel brought on by slower construction activity across the country.
However, now that the economy has entered a period of renewed growth, most sectors should see a significant upturn, particularly in light of the major government-backed infrastructure investments in the works.
Indeed, looking at Abu Dhabi’s solid fundamentals, it is clear that the emirate is an attractive investment destination, particularly in the government’s 10 focus sectors laid out in its long-term development plan, Abu Dhabi Economic Vision 2030. These sectors, from media to tourism, financial services and basic industries, should open up greater investment opportunities, as well as power ongoing economic prosperity, in the years to come.