Crude Oil To Account For Just 5% Of UAE’s GDP By 2021

Posted by: : Paul EbelingPosted on: February 9, 2015 Crude Oil To Account For Just 5% Of UAE’s GDP By 2021
 

Crude Oil To Account For Just 5% Of UAE’s GDP By 2021

$OIL

Crude Oil revenues currently contribute 30% to the UAE’s overall GDP

The contribution of oil revenues to the UAE’s GDP is set to fall from around 30% now, to jusr 5% by Y 2021, the country’s deputy PM said Monday.

Speaking at the Government Summit in Dubai, Sheikh Saif bin Zayed, who is also the UAE’s Interior minister, said that the current drop in oil prices was a “challenge, but not a crisis.”

“In the 70s, the UAE used to depend on Oil revenues for 90% of its GDP. If 30 yrs ago, the Oil prices fell to extreme lows, we would have been affected. But today it’s a challenge which we can overcome.”

His words echoed similar sentiments expressed by Abu Dhabi’s Crown Prince Sheikh Mohamed Bin Zayed, who said Monday morning that the UAE’s economy was diversified and would ride through the drop in Crude Oil prices.

Crude Oil prices fell close to 6 yr lows earlier this year, before recovering in the last 2 wks to over 52 bbl on reports of reduced supply.

In January, the International Monetary Fund (IMF) slashed its economic growth forecast for the UAE owing to the decline in Crude Oil prices.

The IMF said that the UAE is expected to see GDP growth of 3.5% in Ys 2015 and 2016, down by 1% from its October estimate.

Abu Dhabi, highly dependent on Crude Oil revenues, is set to see an overall economic growth of 3% while its non-Oil economy is slated to grow 5.5% in Y 2015, IMF said.

Dubai’s economy is projected to grow by 4.5% this year and 4.6% in Y 2016, it added.

Sheikh Saif stressed that the country was diversifying into sectors such as investment through institutions such as sovereign wealth fund ADIA, and into developing its human resources.

“While Oil is considered the wealth of a country, our true wealth lies in investing in the mind, investing in the education of our children,” he said.

“We will look at the future with optimism even when the last barrel of Oil leaves, because our youth, in whom we have invested, comprise our real wealth.”

HeffX-LTN Analysis for OIL: Overall Short Intermediate Long
Bearish (-0.26) Neutral (-0.07) Neutral (-0.18) Very Bearish (-0.54)

By Aarti Nagraj

Paul Ebeling, Editor

HeffX-LTN

 

 

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Paul Ebeling

Pattern Recognition Analyst, equities, commodities, forex
Paul Ebeling is best known for his work as writer and publisher of “The Red Roadmaster’s Technical Report” on the US Major Market Indices™, a highly-regarded, weekly financial market letter, where he enjoys an international audience among opinion makers, business leaders, and respected organizations. Something of a pioneer in online stock market and commodities discussion and analysis, Ebeling has been online since 1994. He has studied and worked in the global financial and stock markets since 1984.

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