Abu Dhabi Plan to Spur UAE Growth
- 18 March 2013
Plans by Abu Dhabi to invest nearly Dh30 billion through its 2013-2017 development plan will spur growth in the UAE, create about 5,000 jobs and expand the non-hydrocarbon sector, according to an economic analyst.
The plan, approved recently by the Abu Dhabi Executive Council (the emirate’s cabinet), is part of a long-term development blueprint known as Vision 2030 that will push the emirate into a new era of socio-economic development.
“The implementation of this plan is expected to result in radical changes both at the social and economic levels. The foremost objective of the plan is to enhance citizen welfare,” said Mohammed Al Asumi, a well-known economist based in the UAE.
“The five-year plan will also contribute, through its huge investments, to developing non-oil sectors toward diversifying the sources of national revenue and in providing job opportunities for citizens. According to estimates, about 5,000 jobs will be created in
2013 alone, which signifies absorbing large numbers of UAE national graduates into the process of development,” he said in an article published by the Abu Dhabi-based Emirates Center for Strategic Studies and Research (ECSSR).
He said the investments would also contribute to increasing the pace of growth in Abu Dhabi and the UAE in general. Although growth for
2013 is expected to be four percent, the International Monetary Fund
(IMF) estimates that the rate will increase to 6.4 percent toward the end of this plan, Asumi added.
“The new investments will be mostly directed toward non-oil sectors, especially in construction and services,” said Asumi, a former adviser for the Dubai Executive Office and ex-manager of the Economic Research Section of the Emirates Industrial Bank.
He noted that the plan envisages offering Dh three billion in housing loans for 1,500 nationals in 2013, which means supplying this sector “with investments that will contribute to its recovery and increase its share of GDP.”
In addition to housing, infrastructure projects will account for a large proportion of these investments, particularly the planned expansion of Abu Dhabi International Airport and the completion of road and communication projects, including the Etihad Rail network, which will be an important addition to the transportation sector in the country, he said.
Among the UAE’s main projects – which the Executive Council places on top of its list of priorities – are those dedicated to sustainable development, such as those related to development of alternative sources of energy (solar energy in particular), the funding of initiatives to preserve the environment, and the establishment of key industries.
This approach, Asumi said, comes as a completion of measures to ward off the impact of the global financial crisis, which the country has managed to overcome.
Citing official data, he said the ratio of development spending in Abu Dhabi increased significantly to reach 15.2 percent in 2011, amounting to Dh27.3 billion compared to Dh23.7 billion in 2010, thus rising to pre-crisis levels.
“This has contributed to the completion of many development projects across various sectors in recent years. Given the close integration of the country’s economic and political constituents, the development projects will extend to include the rest of the emirates since the Follow-up Committee of the initiatives taken by the President has recently approved the launch of several vital projects in different emirates,” he said.
“In another significant gesture, the five-year plan provides for the necessity of forging a partnership with the private sector, which means taking into consideration the growing role of the private sector, particularly in large projects and in providing job opportunities for UAE nationals, which is a strategic objective that the country seeks to achieve.”
Asumi said this approach aims to support economic diversification, which possesses significant capacities, as an important component of development.
He stressed that the private sector should take advantage and increase its investments in development and productive sectors and to contribute to providing job opportunities.
“Hence, we find that the plan includes a comprehensive investment vision that will result in radical, structural changes not only for the national economy of Abu Dhabi but the whole country…. this means that infrastructure will become more developed and pave the way for more development projects and national and foreign investment by 2017.
We are also expected to see a large improvement in the standards of living in the country and the availability of job opportunities for its citizens.”