Infrastructure deals to boost UAE growth to 4%
Central bank governor highlights average GDP for next two years
Upcoming infrastructure projects are likely to power the UAE economy to a 4% average growth for this year and next, the central bank governor said earlier today.
“These projects are expected to add value and help expand other economic sectors,” Sultan Bin Nasser al-Suwaidi said at a conference in Singapore today.
The country saw growth of 2.1% last year and has a number of power and rail-related projects, in particular the plans for a country-wide railway system.
GTCC, Besix, Takreer and Arabtec subsidiary Target Engineering recently won a spate of contracts emerging from Abu Dhabi, the biggest emirate, which includes utilities and infrastructure projects. Union Railways Company won the contract for the railway system and plans to begin work in 2013, its chief executive said last month.
Last month Sultan bin Saeed al-Mansouri, the economy minister, said that the UAE economy may expand as much as 3.2% this year with crude oil prices around US $85 a barrel, dropping to between 2-2.5% if barrel price falls to $75. He added that there would be no further restructuring of the debts of Dubai World and other entities, though he had anticipated the country to suffer some knock-on effects to the debt crisis in the eurozone.
The growth forecasts are a significant improvement on the opinions of financial institutions at the start of the year. Merrill Lynch had predicted last December that the UAE was likely to see flat growth in 2010, with Dubai even slipping into negative territory.
In March this year the bank forecasted that the Saudi economy would reach 3.9% this year, and echo of the prediction by Banque Saudi Fransi made at the start of 2010.