Abu Dhabi: The UAE’s Minister of Economy Sultan Bin Saeed Al Mansouri expressed optimism yesterday that the economy will continue to grow this year, boosted by higher oil prices. However, he also cautioned growth will depend on a number of factors including stability in the region and the political scene globally.
“I am positive (about the economy) but it will all depend on what will happen on the political scene in the world and also the general economy in other parts of the world whether it is the US or the EU or China and also the stability of the world including our region,” said Al Mansouri speaking to reporters on the sidelines of UAE-Jordan Investment Forum in Abu Dhabi yesterday.
He expected the UAE’s economy to grow between 3.5 to 4 per cent this year.
“The UAE has gone through some challenges since 2008, but we managed it very nicely and we continued to grow with the average between 3.5 to 4 per cent. I see this to continue this year,” he said. The UAE’s GDP growth last year was 3.7 per cent, he said.
Oil prices are currently trading higher when compared to last year due to agreement between Opec and non-Opec members to cut production by about 1.8 million barrels per day to stabilise oil prices.
International Monetary Fund (IMF) in October projected a GDP growth of 2.5 per cent for 2017.
When asked whether there will be any IPO’s (Initial Public Offering) this year, he said it should be left to the sector itself to decide about the right time to launch an IPO. “They decide themselves when is the right time to come in and it is up to them when is the right time to really launch IPO. It is important to leave it to the sector.”
Asked if government entities could take the initiative to kick-start IPOs, he said the government has not decided anything on it yet and that it could be considered in the future.
IPOs in the region may be headed for a revival as countries, including the UAE, work to make themselves less dependent on oil.
Saudi Arabia, the largest Gulf Arab economy, is taking steps to overhaul its economy, including plans for what could be the largest-ever IPO with the listing of Saudi Arabian Oil Company.
Companies in the region raised just $1.4 billion (Dh5.14 billion) from listings last year, compared with $2.9 billion in 2015, according to data compiled by Bloomberg.
Emirates Global Aluminium, the largest aluminium producer in the Middle East, owned jointly by Mubadala and the Investment Corporation of Dubai is also seeking advisers for a potential initial public offering on the local stock exchange as early as this year.
“Oil revenue constitutes less than 30 per cent of the UAE’s GDP because we’ve been working in diversification and we’ve been successful in lowering our dependency of oil. We want to reach a point where it doesn’t contribute anything to the GDP,” he said while addressing the delegates at the forum.
He also underlined the importance of increased cooperation between Jordan and the UAE to boost trade and investments. The bilateral trade between the two countries is $15 billion.