UAE's real GDP to grow 2.5 per cent in 2010: report

Strong growth in Abu Dhabi is expected to fuel a 2.5 per cent increase in the United Arab Emirates' real gross domestic product (GDP) in 2010, despite a in 0.4 per cent slump in Dubai's economy, a leading financial services company Shuaa Capital said in its UAE Vision 2010 released yesterday.

"We expect the Emirates to emerge from the recession in 2010, and we are forecasting real GDP growth of 2.5 per cent this year," after a decline of 3.5 per cent in 2009, said Mahdi Mattar, head of research and chief economist, Shuaa Capital.

"This growth will largely be driven by strong projected real GDP growth of 4.1 per cent in Abu Dhabi, compared with a drop of 2.7 per cent last year led by a sharp decline in hydrocarbons production,'' the Dubai-based company said.

Dubai's economy plunged 5 per cent last year.

The vision also provides an overview of the UAE's market outlook for 2010 with a special focus on the banking, real estate and telecom sectors as well as stock briefs for more than 25 UAE listed companies.

"We expect the UAE markets to record gains of around 20 to 25 per cent in 2010…supported by corporate earnings growth (expected to record a growth of 17 per cent from a low base in 2009), other positive corporate news flows, and improved investor sentiment post Dubai World's debt issue resolution," Mattar added.