Under the patronage of His Highness Sheikh Hamdan bin Mohammed bin Rashid Al Maktoum, Crown Prince and Chairman of the Executive Council of Dubai, the second annual UAE Economic Outlook 2015 forum, jointly hosted by the Department of Economic Development in Dubai and the Department of Economic Development in Abu Dhabi opened today at the Armani Hotel Dubai.
The two-day forum, which will conclude tomorrow, aims to analyse the economic outlook for the UAE in light of the global economic context and prospects. Over 300 executives from the government and the private sector are participating in the forum along with economic experts and heads of various international and local businesses.
Delivering his keynote address at the opening session His Highness Sheikh Ahmed bin Saeed Al Maktoum, President of Dubai Civil Aviation and Chairman & Chief Executive of Emirates Airline and Group emphasised the importance of the forum in evaluating the prospects for the UAE economy in 2015 and in promoting the march towards a knowledge economy.
Sheikh Ahmed said: “Dubai has proved its economic resilience and its ability to cope with the vagaries of the global economy, which continues to raise concerns. Dubai economy grew by more than four per cent annually over the past four years, compared to 3.5% growth in global economy in the same period. As per preliminary estimates Dubai is set to grow 4.5% in 2014.”
“Despite the success we have achieved, and our ambitions, we are on alert to face any challenges that may arise on the global economic horizon, or any impact on our finances. For example, we have taken steps to control government spending and thus avoid the budget deficit. We are also on alert against volatility in the real estate market while factoring the positive contribution of this sector to economic development in Dubai and in meeting real demand,” said His Highness.
Sheikh Ahmed sserted that the government has taken measures to curb speculative practices in the real estate sector by increasing registration fees from two to four per cent of the transaction value and issuing guidelines on adjusting rentals while the UAE Central bank has introduced new caps on real estate mortgage. The government has also sought to control inflation to support households and maintain Dubai’s competitiveness.
“The focus of this event on knowledge economy fits well with the aspirations of Dubai to enhance it sknowledge capital through skills and new technologies which eventually will lead to high productivity. The leadership has developed an integrated strategy, which comprises 100 initiatives and 1,000 smart services, to transform Dubai into one of the smartest cities in the world. Economic activities, lifestyles, transportation, and government services will be aligned with smart technologies, environment and human capital development, leading to the realisation of the knowledge economy,” His Highness added.
His Excellency Sultan Bin Saeed Al Mansouri, UAE Minister of State for economy, said in his speech that Dubai hosting the World Expo 2020 will have economic repercussions for the UAE in general and for the Emirate of Dubai in particular during the next six years.
“The estimated financial returns from the Expo 2020 is AED 139 billion and Dubai is expected to receive more than 25 million visitors during the event, about 70% of them from abroad. It will provide a strong impetus to overall economic activity in Dubai, which is chiefly led by tourism, aviation and infrastructure development,” the Minister said.
Al Mansouri added that the Expo is expected to generate more than 277,000 jobs between 2013 and 2020, and for every Expo employee approximately 50 additional jobs will be sustained across the surrounding area from Africa to South Asia and the Arab world. “The infrastructure and logistics cost of Expo 2020 is projected to be more than nine billion dollars. It is expected to bring foreign investment into European companies bidding for a share of Expo-related projects, particularly those in the construction, tourism, retail , hotels and restaurants sectors.”
The Minister said that the economic forecasts and reports of international organisations show that the UAE economy will continue to achieve positive growth rates driven by the results achieved in previous years. UAE’s GDP is valued at 1.55 trillion dirhams as of the end of 2014, and is expected to rise to 1.62 trillion dirhams by the end of 2015. GDP growth in 2014 is estimated to be 4.3% and remain steady at 4.5 % in 2015, 2016 and 2017 before rising to 4.6% during the 2018-19 period.
Al Mansouri stated: “The UAE’s positive economic outlook was also confirmed by the International Monetary Fund (IMF) in its 2014 report where it says the country will have a budget surplus of 6.9-10.5% over the next six years leading to 2019.”
The IMF report also reaffirmed the UAE’s position as a regional and global hub when it listed the country among the 20 largest exporters in the world. The UAE exports of goods and services will reach 1.47 trillion dirhams by the end of the year 2014 and increase to AED 1.59 trillion in 2015 and to two billion dirhams in 2018. Based on the pace of economic recovery and expected increase in re-export activity, the value of imports is also estimated to reach about AED 885 billion in 2014 compared to AED 797 billion in 2013.
Al Mansouri said that the non-oil sectors in the UAE are likely to see increased foreign investment inflows as a result of favourable market conditions. FDI (foreign direct investment) in the country’s leading tourism, real estate and construction sectors grew by 20% in 2013 and is expected to rise further in 2014 to around AED 44 billion.
His Excellency Sami Al Qamzi, Director General of the Dubai Department of Economic Development said: “The UAE Economic Outlook forum demonstrates our fruitful collaboration with the Department of Economic Development in Abu Dhabi and enables us to discuss economic developments and prospects at the federal and local level. It is also a valuable opportunity to learn from mutual experiences and development strategies, in partnership with public and private sectors and local and international experts.”
“We have presented the overall Dubai economic landscape to the forum as well as the opportunities available in the emirate while also sharing views on various economic hubs. We are ready to take into account all proposals and solutions that will emerge from this forum, and then work on applying whatever is suited to our goal of sustainable growth and business competitiveness in Dubai,” Sami added.
The first session of the opening day was addressed by Harold Finger, Deputy Division Chief of the Middle East and Central Asia Department at the International Monetary Fund, who spoke on the latest developments and prospects for the global economy and its impact on regional economic performance, especially economic activity in the UAE. It was followed by two presentations – Shorooq Al Zaabi, Head, Development Indicators & Future Studies Division and Project Manager at the Abu Dhabi Centre for the Economic Policies and Research presented the ‘Abu Dhabi Economic Outlook 2015’ and Dr. Mohammed Lehouel, Chief Economist at the Department of Economic Development, Dubai presented the ‘Dubai Economic Outlook.’
A panel discussion attended by leading economists and businessmen and moderated by Dr. Tommy Weir, founder and Managing Director of Emerging Markets Leadership Centre, concluded the first day’s programme. The panelists included His Excellency Mohammed Abdul Jalil Al Fahim, Chairman, Al Fahim Group; Shehab Gargash, CEO, Daman Investments; Dr. Abdulrazaq Al Fares, Chief Economist, Dubai Economic Council; Gary Dugan, Global Private Banking Chief Investment Officer & Head of Investment Strategy, National Bank of Abu Dhabi and Pratibha Thaker, Director of Middle East and Africa, The Economist Intelligence Unit.
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