ABU DHABI, (Reuters) – Abu Dhabi plans to grow by an average of 7 percent a year until 2015 and 6 percent a year thereafter, supported by economic diversification and a reduced dependence on oil, a bond prospectus showed on Monday.
The capital of the United Arab Emirates, which accounts for most of the country’s oil wealth, would expand at total growth in gross domestic product GDP.L of over 500 percent by 2030, a prospectus by Abu Dhabi’s investment vehicle, Mubadala, seen by Reuters showed.
“The 2030 Economic Vision seeks to grow Abu Dhabi’s GDP by an average of seven percent per annum through 2015, and thereafter to stabilise growth at an average of six percent per annum for total growth in GDP of over 500 percent by 2030,” the document said.
Unlisted Mubadala held investor roadshows in Abu Dhabi and Dubai on Sunday as it plans to invest around 60 billion dirhams in 2011.
In 2009, the Abu Dhabi government set up a long-term plan to turn the emirate into a knowledge-based economy and reduce its dependence on the oil sector.
Its 2030 Economic Vision aims to significantly expand the non-oil sector by 2030 to reach a balance between oil and non-oil trade by 2028.
“The government also intends to foster non-oil GDP growth at a higher rate than that of the oil sector, with a goal of reaching equilibrium in oil and non-oil trade by 2028,” the prospectus said.
“This growth is not expected to be consistent throughout the period, as different economic cycles and the fluctuation in oil prices will mean that rates of growth will vary from time to time.”
The economic vision focuses on 12 sectors for future growth, such as oil and gas, aviation, tourism and transportation.
The UAE has escaped public unrest sweeping the Arab world, which had also spread to nearby Bahrain, Oman and Yemen.
Worried by the turmoil, the UAE pledged to spend $1.6 billion on infrastructure, keep prices of basic commodities low and raise military pensions. Plans to further cut fuel subsidies were also postponed, industry sources have said.
The prospectus gave no new updated GDP figures. The last data available from the Statistics Centre Abu Dhabi showed nominal GDP of 546.5 billion dirhams in 2009, and 666.7 billion dirhams in 2008.
Abu Dhabi, which makes up for a vast majority of fiscal spending and around 60 percent of the second-largest Arab economy, does not publicly release its budget data.
Last year, Abu Dhabi budgeted to spend 207.5 billion dirhams, forecasting a budget shortfall of 84.9 billion. It based its 2010 budget on $60 per barrel.
“These economic gains are expected to be achieved with the support of a sound monetary and fiscal policy designed to support Abu Dhabi’s businesses in increasingly competitive global markets,” the prospectus said.
“However, no assurance can be given that these economic gains will be achieved as anticipated or at all.”
Fiscal policy is a key tool in steering the UAE economy since the world’s No.3 oil exporter pegs its dirham currency to the U.S. dollar.
Crude prices soared on the regional unrest and now trade at around $125 per barrel, well above the budgeted oil price.