Abu Dhabi probably won’t reach its target for industrial growth by 2020 and will need to lower it, a senior government official said on Monday.
The oil-exporting emirate is investing billions of dirhams to diversify its economy, but the goal for industry is hard to reach, Ayman al Makkawy, director-general of the emirate’s new Industrial Development Bureau (IDB), said on Monday.
The original target was for industry to contribute 19 per cent of the economy by 2020 and 24 per cent by 2030. It now accounts for about 5.9 per cent.
“Progress has been flat after the (global) crisis. It is not impossible, but it is difficult to achieve,” al Makkawy said at a MEED conference. “We may take a fresh look at the original targets.” The world has changed after the targets were set a few years ago, he added.
IDB was set up last month through a new law as the governing body for industry in Abu Dhabi, the capital of the United Arab Emirates.
Most of Abu Dhabi’s industrial GDP comes from government-owned operations in chemicals and base metals. Several new initiatives will be rolled out to encourage private-sector industry, al Makkawy said.
Some of the initiatives include securing approval for gas supply from the government for new projects, stimulating downstream industries and expansion of free zones, he said. He declined to go into details as the plans have yet to be made public.
The emirate has set up industrial areas and zones in the last couple of years, including the Khalifa Industrial Zone, which has begun attracting companies from overseas to set up industries.
Wealthy Gulf states are likely to see their oil and gas revenues drop next year but heavy government spending and increasingly energetic private sectors will keep economic growth robust, a Reuters poll suggested in September.
The U.S.-allied UAE is one of the wealthiest countries in the world, with per capita income of $48,200 in 2012, according to World Bank figures.