Abu Dhabi booms as busi­ness con­fi­dence rises

The Pak Banker - - BUSINESS -

The gen­eral in­dex of con­fi­dence in the busi­ness cli­mate in Abu Dhabi im­proved two points year-on-year to 61 points, in the first quar­ter of the year.

How­ever, it dipped two points on quar­ter-on-quar­ter ba­sis, says a joint study by the Stud­ies Di­vi­sion of the Depart­ment of Eco­nomic De­vel­op­ment and the Sta­tis­tics Cen­tre-Abu Dhabi. Large in­dus­trial, com­mer­cial, con­struc­tion and ser­vices firms were op­ti­mistic on the gen­eral in­dex of con­fi­dence and cur­rent sit­u­a­tion in­dex. How­ever, small, medium and large es­tab­lish­ments were neu­tral, due to the eco­nomic sce­nario emerged af­ter the plunge in oil prices and slower eco­nomic growth in the Western economies and Greek cri­sis.

The study ex­pected that the good fi­nan­cial con­di­tions in Abu Dhabi, as re­flected in the credit qual­ity clas­si­fi­ca­tion (+AA) by Stan­dard & Poor's Agency, boosted con­fi­dence in the econ­omy, as credit rat­ing agency, Stan­dard & Poor's ex­cluded the im­pact of the fluc­tu­a­tions in oil prices on de­vel­op­ment projects.

Abu Dhabi Busi­ness Cen­ter has re­duced the av­er­age num­ber of pro­ce­dures for the is­suance of com­mer­cial li­censes and the num­ber of days nec­es­sary to start a busi­ness by half and the av­er­age cost of is­su­ing com­mer­cial li­censes by 30 per cent. Abu Dhabi is work­ing on com­plet­ing the com­mon sys­tem for the is­suance of var­i­ous com­mer­cial li­censes in Abu Dhabi by next year. In its ef­forts to boost do­mes­tic de­mand, Abu Dhabi is spend­ing Dh330 bil­lion on in­fra­struc­ture projects dur­ing the five-year 2013-2017 pe­riod. This pol­icy has also helped im­proved busi­ness sen­ti­ments. Abu Dhabi is­sued 2,452 new com­mer­cial li­censes in the Jan­uary-March pe­riod as it re­mained a pre­ferred des­ti­na­tion for busi­ness.

The firms in­volved in var­i­ous busi­nesses showed op­ti­mism about their in­ter­nal sit­u­a­tion and the eco­nomic sit­u­a­tion in gen­eral in the quar­ter. The re­sults show an im­prove­ment in the per­for­mance of the trade sec­tor, re­flected by the in­crease in the to­tal value of non-oil mer­chan­dise trade in Abu Dhabi dur­ing the last quar­ter of 2014 by 15.8 per cent year-onyear to Dh39.4 bil­lion. The value of non-oil ex­ports in­creased 12.6 per cent to reach Dh4.7 bil­lion.

The in­dus­trial sec­tor's per­for­mance was af­fected by the fall of prices, as the pro­ducer prices in­dex de­creased by 8.6 per cent in the fourth quar­ter of 2014 com­pared to the third quar­ter of the same year. This came de­spite the bet­ter per­for­mance of the man­u­fac­tur­ing in­dus­tries, as the In­dus­trial Pro­duc­tion In­dex in­creased by 2.2 per cent, while in the ser­vice sec­tors, the tourism sec­tor has sig­nif­i­cantly im­proved, as the num­ber of guests and room oc­cu­pancy lev­els rose in ad­di­tion to the ho­tels rev­enues dur­ing the month of Jan­uary 2015 com­pared to the same month of 2014, ac­cord­ing to the re­port of Abu Dhabi Tourism and Cul­ture Au­thor­ity.

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