Abu Dhabi flexes economic muscles with 10.5% growth spurt

Reuters/Alexander Cornwell

• Non-oil sectors contributed 50.3% to GDP
• Government investing in programmes to double size of manufacturing

Abu Dhabi’s economy is “proving its superiority” after producing the highest growth in the Middle East and North Africa during the first nine months of 2022.

Statistics Centre Abu Dhabi said on Tuesday that it estimates that growth in GDP touched 10.5 percent compared to the same period of 2021.

Ahmed Jasim Al Zaabi, chairman of the Abu Dhabi Department of Economic Development, said: “Abu Dhabi’s robust economy continues to prove its superiority, driven by our leadership’s clear vision, its ability to attract foreign direct investments and agile policies that enabled our economy to achieve the strongest growth in the region.”

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According to the new figures, non-oil sectors contributed 50.3 percent to GDP, with an increase of AED39 billion ($9.9 billion) compared to the same period in 2021, to reach AED417.3 billion in total by the end of Q3.

Abu Dhabi has launched a number of initiatives in recent years as it focuses on diversifying its economy away from oil and encouraging foreign direct investment.

In November, a new smart manufacturing index was launched to boost Abu Dhabi’s emergence as a key industrial hub in the Middle East.

Manufacturing activities in the emirate grew by 8.1 percent and contributed 8 percent to the total GDP during the first nine months of 2022. 

The Abu Dhabi government recently announced that it will invest AED10 billion across a number of ambitious industrial programmes to more than double the size of the emirate’s manufacturing sector to AED172 billion by 2031.

The new strategy aims to boost Abu Dhabi’s trade with international markets, with the plan to increase non-oil exports by 143 percent to AED178.8 billion by 2031.

Investment in Abu Dhabi’s active industrial sector tripled over the year to mid-2022, according to figures released by the Industrial Development Bureau.

The total value of factories that switched to the in-production stage rose to AED3.1 billion during the first six months of 2022, compared to AED1.03 billion in the year-earlier period.

According to Statistics Centre Abu Dhabi all key economic sectors demonstrated “impressive growth that portend a bright future”.

It said Abu Dhabi’s real estate sector saw a 20.3 percent expansion during the first nine months of 2022 as investors rushed to Abu Dhabi’s waterfront and island communities, such as Saadiyat Island, Yas Island, Al Reem Island and Al Raha Gardens.

The accommodation and food services sector achieved a growth rate of 20.2 percent while Abu Dhabi’s Department of Culture and Tourism said it welcomed 4.1 million international visitors over the same period. Indian visitors accounted for 12 percent of all non-Emirati hotel guests.

During the first nine months of 2022, the value of the wholesale and retail trade sector reached AED45 billion, up 17.4 percent, and accounting for 5.4 percent of Abu Dhabi’s nine-month GDP.

The transportation and storage sector saw an added value of AED14 billion in the first nine months of 2022, recording a growth of 11.4 percent as the emirate’s airports were used by 15.9 million passengers.

“2022 was a remarkable year for Abu Dhabi in passenger traffic terms,” said Jamal Salem Al Dhaheri, managing director and CEO of Abu Dhabi Airports. “It illustrates the emirate’s vast potential as an attractive destination to visit, live and work in. 

“We’re working towards readiness to accommodate even greater passenger traffic in 2023, which we anticipate, as higher numbers of international visitors come to the UAE for key events.”

Creative

As of December, Abu Dhabi International Airport served more than 100 destinations and had a network of 28 airlines.

Abu Dhabi’s financial sector also grew by 6.9 percent with a value of AED28 billion as the emirate enhanced its status as a preferred destination for investors, entrepreneurs and innovators.

Ahmed Mahmoud Fikri, director general of Statistics Centre Abu Dhabi, said: “This growth is attributed to the strategic policies of prudent leadership, which have aimed at diversifying the economy, fostering private sector engagement and investing in human capital.

“These efforts have established a robust economic environment resilient to challenges.”

On Tuesday, the Abu Dhabi Department of Economic Development also launched the Abu Dhabi SME Champion programme to help SMEs compete professionally in procurement and scale up their businesses to play a greater role in Abu Dhabi’s economy.

SMEs are one of the key sectors in Abu Dhabi’s economy. They make up over 90 percent of businesses, employ 39 percent of the workforce and contribute 32 percent of non-oil GDP.