UAE reaches an economic milestone

The value of goods and services produced in the UAE this year is expected to exceed Dh1 trillion, according to Ahmad Humaid Al Tayer, Governor of the Dubai International Financial Centre. The UAE will reach the milestone despite the difficult challenges facing the local economy in part because of the volatility and weakness in international markets.

The continued growth of the UAE in these times underlines the success of the country's investment in diversifying its economy beyond oil and building and strengthening different sectors and industries.

The UAE's tourism, transport, trade and re-export sectors grew by double digits and contributed to the continued economic growth, Al Tayer said at a conference organised by the Union of Arab Banks in Dubai. The growth in these sectors has reduced the dependence of the UAE economy on oil and the real estate industry, both of which have been affected by the global economic and financial crises.

The country's banks had also stabilised their balance sheets and have more than sufficient capital to cover potential losses, Al Tayer said. This is important if the UAE's economic growth is to be sustained. Unless banks are willing to lend to individuals and companies, there will not be funds available for investment and to create the demand for goods and services necessary for economic growth and job creation. Loan growth in the UAE is expected to pass eight per cent next year.

The Ministry of the Economy and the International Monetary Fund, among others, have predicted slow but steady economic growth for the UAE this year. After the rapid achievements of the recent past, a period of consolidation is necessary for the economy.

The Dh1 trillion mark is yet another milestone as the UAE moves steadily towards its goal of economic and social development for all its residents.