UAE expects GDP growth at 3.5% yearly until 2015

The United Arab Emirates' GDP will grow by around 3.5 percent per annum until 2015, said Dr. Georg Abed, director of Africa and Middle East of the Washington-based Institute of International Finance (IIF) here on Monday. Speaking at the annual IIF media roundtable, Abed said the UAE' s nominal gross domestic product (GDP) would grow to 432.1 billion U.S. dollars in 2015, up from 371.9 billion U.S. dollars last year. Abed said that the UAE as a major oil supplier was not only benefitting from constantly high oil prices, but also from large surplus in external and fiscal balances and growing share of its non-oil economy amid a successful diversification of its economy. The share of the hydrocarbon industry in the UAE sank to 32 percent in 2013 from 47 percent in 2000, said Abed. Dubai, the UAE's business and trade center, was playing its role well as the Middle East's stable and most connected hub for trade, tourism and banking, said Abed. At the same time, stock market and the real estate sector, which suffered heavily in the wake of the recession, picked up significantly with UAE's economic comeback. Stock markets in Dubai and Abu Dhabi gained since January 2013 by 35 percent and 29 percent, respectively. In addition, "UAE's sovereign wealth funds and government related entities (GREs) are increasingly investing at home rather abroad which help boost the Gulf state's GDP growth," said Abed. The main risk to the growth which IIF forecast was lying in a decline of oil prices to below 85 dollars per barrel. However, " the IIF expects oil prices to be at 108 dollars per barrel this year," said Abed, adding that other risks would be an Israeli attack on Iran and new turmoil in the Arab world.