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UAE macro-economy stable, sustainable and its banking resilient

By Mehmood-Ul-Hassan Khan

Abu Dhabi: November 29. A media delegation from Pakistan is currently in the United Arab Emirates on the invitation of National Media Council for the 40th National Day Celebrations. First day of their trip, H.E. Mohammed Omar Abdullah Undersecretary, Department of economic development, H.E. Sultan Naseer Al Surwaidi, Governor of UAE Central Bank and H.E. Saqr Ghobash, minister of Labour briefed about their respective fields.
H.E Mohammed Omar Abdullah highly projected the significance of Abu Dhabi Strategic Vision 2030 for achieving higher targets of socio-economic growth in the future.
“Abu Dhabi’s 2030 which stands for further diversification of economy, better higher education, entrepreneurism, research, development of small to medium-sized businesses and knowledge-based economy would achieve its desired goals in the days to come he added”.
H.E Mohammed Omar Abdullah said diversification of economy is the highest priority of the UAE government. He said till 2030 hopefully the diversification of macro-economy may reach to 64 percent of GDP.
“It has four principles, first, active participation of private sector, second integration of national economy with the global economy, third, provide business and investment friendly environment and fourth excel in renewable energy mix including peaceful nuclear energy program in order to match with the increasing demands of energy supplies in the country, he further explained”.
He said despite ongoing Euro debt crisis and weak global economic scenarios, UAE economic are resilient, strong and sustainable due to its prudent policies. He said that ongoing Arab Spring has brought tremendous opportunities for the UAE in terms of greater inflows of foreign direct investment, joint ventures and trade and commerce ties.
He elaborated that diversification drive of economy is now paying its dividends. He shared that the UAE government’s constant support to industrial sector has made it UAE less reliant on revenue from its oil exports. Its non-oil foreign trade surged by 14 per cent in 2010, to Dh 754.4 billion (US $ 205.3 billion), compared to 2009. Exports increased by 27 per cent and re-exports registered 26 per cent upwards growth, with non-oil imports rising only by 8 per cent. He said that the UAE also ranked 25th largest global importer of goods and 19th exporter in the world 2010 becoming the only Arab nation to be among the top 30 markets.
He clarified that oil and gas revenues now account for 30 per cent of GDP despite high oil prices at international markets. He said, now manufacturing sector is active, healthy and productive. It is one of the leading sources of employment generation, exports and revenues. It is hoped that a strong manufacturing industry that meets the needs of the international markets will help protect the UAE from the continuing economic turmoil he added.
He briefed about the salient features of UAE economic growth model based on evolutionary approach by achieving sustainable development. He said that UAE is a federation and all the seven emirates jointly work for the socio-economic betterment of its people at large.
He said that economic integration with Asia is one of the main characteristics of its country, UAE has strong bilateral trade relations with China, Pakistan, Korea, Malaysia and other regional countries, and we are looking forward for its further strengthening of trade and commerce relations with Asian countries.
He talked about inter-GCC trade, prospects of economic integration, monetary union and one gold currency in the Gulf Cooperation Council countries and shared UAE government sincere efforts towards achieving desired socio-economic integration goals within the GCC.

H.E. Sultan Naseer Al Suwaidi Governor of UAE Central Bank

H.E. Sultan Naseer Al Suwaidi Governor of UAE Central Bank said that UAE banking and financial system is resilient and is providing essential inputs for survival and production. Banks in the United Arab Emirates are in a good position and should not be affected by turmoil in global financial markets he added.
“The IIF report (2011) indicated that the country has one of the strongest fiscal positions in the region he added”. He sated that Its projected total gross foreign assets of the UAE to continue rising to about $600 million by end 2012. It would result in an overall net external asset position of about $480 billion, equivalent to 130 per cent of 2012 projected GDP he further elaborated.
He briefly talked about the basic composition of the UAE banking system comprising of 24 national banks with 762 branches throughout the country, with 8 Islamic banks, 32 foreign banks and exchanges 196. Foreign banks capital assets reach to 340 billion Dh he further added. He defended UAE pegging policy with dollar and clarified that there is no threat to its banking and financial system due to ongoing banking and financial crisis of the European Union. He suggested that EU should tackle its liquidity problem as soon as possible for the revival of global economy.
Responding to question about banking sanctions on Iran, he clearly defined his government policy towards the compliance of UN Security Council Resolution. He said the even ASEAN does not have common currency but prospects of greater economic integration and FTAs are bright in these countries. The prospects of common currency and monetary union are bright and hopefully with the passage of time we would achieve it he added.
He said that UAE government and economy is better prepared to face a fresh global slowdown by its diversification drive and GDP may reach to 4.5 percent in 2011. Suwaidi also said in October exposure of the country’s banks to sovereign and private sector debt in Europe is small and their capital adequacy ratio was around 11 per cent. He said monetary policy of the UAE is stable and soft and supports business and investment environment of the country.

H.E. Saqr Ghobash, minister of Labour, UAE

H.E. Saqr Ghobash, minister of Labour talked about UAE labour policy, incentives, prospects and emerging trends in the UAE labour markets. He clarified that the UAE government is open to any country and especially Pakistan for labour import but it is the organizations and different private sectors to decide to recruit. He said that UAE is still safe heaven for seeking employment for securing prosper socio-economic future for all the countries in the world. He said that his country is following and implementing the MDGs in letters and spirits. He highlighted the salient features of the UAE new labour policy and said it is labour friendly which promises to safe guard their dignity and hnour along with financial benefits. He said that UAE has already formulated National Qualification Authority for the betterment of Emiratization drive

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