UAE's GDP surges to Dh248b in 2001 - study

UAE's economy swelled by more than six times over the past 26 years to become the fourth biggest economy in the Arab world.

From around Dh39.7 billion in 1975, the country's GDP surged to nearly Dh248 billion in current prices in 2001, showed figures provided by Abdullah Al Kharji, first deputy chairman of UAE Chambers' Union.

The GDP is projected to climb to Dh256.9 billion this year despite lower crude oil prices and production by the UAE in line with a collective agreement between Opec and other producers to tighten supplies.

Western forecasts point to a further growth in the coming few years mainly in the non-oil sector, which has become the driving force in economic activity in the emirates due to a government policy to diversify sources of income.

Such a policy resulted in a sharp expansion in non-oil sectors, which were worth around Dh18 billion in 1975, accounting for about 46 per cent of GDP.

In 2001, non-oil GDP shot up to nearly Dh179 billion to become the dominant component in GDP, accounting for around 72 per cent.

"All these indicators are very encouraging signs of economic prosperity in the UAE and an evidence of the success of economic diversification and performance," Kharji said.

Excluding Iraq, whose economy has been wrecked by UN sanctions, the UAE now has the fourth largest Arab economy after Saudi Arabia, Egypt and Algeria.

The growth of more than 20 per cent a year over the past quarter a century was mainly triggered by massive investments by the public and private sectors into industry and other non-oil fields and a sharp expansion in the UAE's crude and gas output.

The UAE produced just below half a million barrels per day of oil in the early 1970s and current output averages nearly two million bpd, making it one of the top crude suppliers in the world.

Production is set to climb above three million bpd in coming years as the country pushes ahead with capacity expansions to face growing global demand.

The UAE was also the first Arab nation to set up a LNG plant on Das Island, where production has been doubled to more than five million tonnes. Such a project and other gas ventures now fetch the UAE more than $2 billion a year.

Central Bank figures showed public and private investments totalled Dh116 billion in 2000 and 2001 and they are expected to be close to Dh60 billion this year.

This means overall investments could exceed Dh800 billion.

One of the main beneficiaries of such investments is the industrial sector, which accounted for 19.3 per cent of the overall GDP in 2001 compared with less than five per cent in 1975.