• Home
• /
• Business

Impact of Global Recession Minimal on UAE

“This disease that is infecting the economies of the rest of the world will slow our pace, but business will continue,” said Al Habtoor in an interview with the Oxford Business Group which is set to publish shortly its business guide book entitled, “The Report: Dubai 2009.”

“We still have companies growing at rates between 45 per cent and 60 per cent, and the overall economy has a growth rate in excess of 6.5 per cent, so business is still progressing,” insisted Al Habtoor.

Economists said the UAE’s economic expansion may ease at least for the next two years as a result of the global economic malaise and falling oil prices.

This is hitting the UAE’s real estate sector hard, which has largely sustained its rapid growth in the last six years, as speculative investors took flight when liquidity dried up with banks imposing more rigid lending criteria.

Al Habtoor maintained the UAE’s economic fundamentals are still sound and eroding confidence has been “purely psychological” but admitted “it is very difficult to cure this issue.”

“The stock market has been constantly going down without any reason: many of our local companies are producing great results and fantastic dividends, yet they continue to see their share prices go down.”

Al Habtoor said negative sentiment will likely put at bay plans by private companies to go public.

To better unpredictable economic upheavals, Al Habtoor urged the GCC to cooperate better to strengthen their economies.

“There is no real coordination between the GCC countries and I would prefer it if we could find as common economic strategy and even some political views — then we would have more weight on the nternational stage than we currently do.”

A first step he suggested is the establishment of a common regional currency. The Al Habtoor Group is one of UAE’s biggest conglomerates, with interests in various sectors.

rocel@khaleejtimes.com