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UAE economy shrinks, but how far?

UAE economy shrinks, but how far?

While officials say that the country will see economic recovery later this year, we ask how hard it has really been hit in 2009.

August 31, 2009 2:35 by

A report released by global financial firm Morgan Stanley in July said that the UAE’s economy would shrink by 2 percent in 2009, with a mild recovery predicted for next year.

“The worst may indeed be behind us,” the firm’s analyst Mohamed Jaber said in a research note. “Given the recent improvement in the global economic momentum, the rise in oil prices over the past few months, and the general stabilization in domestic markets, we believe that as far as the UAE is concerned, we may have reached the bottom of this downturn,” he said.

In May this year, the International Monetary Fund said in a report that it expects the UAE economy to decline by just 0.6 percent this year, before recovering to a positive growth rate of 1.5 percent in 2010.

And a report by investment bank EFG Hermes said it expected the country’s GDP to contract by 4 percent this year.

Al Mansouri said that the creation of the National Statistics Center should help in getting the right numbers.

It “contributes to supporting the digital economy of the Emirates and leverages investors’ trust through providing integrated statistical indicators reflecting the factual image of the local economy in an accurate and clear way,” he said. He added that data from all federal and local statistics centers would soon be compiled together to support the Center’s activities.

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