Thursday, January 15, 2009

Forecasting growth in UAE

The Economist Economic Intelligence Unit (EIU) "has downgraded its forecast of UAE GDP growth to 1.5 per cent this year, before recovering to 4.7 per cent in 2010."

That's as reported in Gulf News. More:
The UAE Federal Government should take a lead in reviving the country's economy, in case of a further slowdown, Dubai Chamber of Commerce and Industry said in its latest report.

The Economic Bulletin stated: "If the UAE economy goes through a period of slowdown due to the turmoil in the world markets, then the burden of reviving the economy lies on the government."

The UAE economy is showing signs of slowing down due to the impact of the global economic downturn and lower oil prices - which fell to $36 (Dh132.4) a barrel yesterday. In response, economic forecast analysts have revised their figures for the UAE.
The DCCI bulletin stressed the importance of government initiatives to spur growth with demand- side factors, particularly to bolster investment - and more importantly - private sector investment.

"The lesson to be learned from the Great Depression of the 1930s is that the US government at the time did not play an active role in pre-empting the economic slowdown", the DCCI bulletin said.
As I posted yesterday, the Financial Times reported the Dubai government has "tame[d] its previous GDP growth targets of 11 per cent a year to 2015 down to a more modest 4 to 6 per cent."

EIU reports historical averages for UAE economic aggregates here. Real GDP growth 2003-2007 was 9.3 percent.


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