Further information
Abu Dhabi
| The United Arab Emirates (UAE) is the GCC's second largest economy after Saudi Arabia and home to the region's fifth largest oil reserves. Driven by growth in the hydrocarbons sector, mainly in the Abu Dhabi emirate, and strong growth in domestic demand, real GDP has been rising steadily, with growth reaching 7.4% in 2008, up from 1.3% in 2001. Lower hydrocarbon resources and a change in the political leadership in recent years prompted efforts of diversification in the less energy-rich emirates to foster growth in the services, and recently, in the manufacturing sector to complement the growth in hydrocarbons. While Dubai has been highly successful in marketing its growth potential, the other smaller emirates are each starting their own development programmes and diversification of local growth drivers. Growth in Dubai has been mainly fuelled by growth in construction and real estate, financial services, retail trade, tourism and leisure activities, among others.
With the slowdown in the global economy, and subsequently, tourism arrivals, retail trade and real estate activity, growth in Dubai dropped significantly. Growth in Abu Dhabi was resilient, on the other hand, as rising oil prices positively impacted government revenues. With the stabilization of global conditions, the UAE is expected to recover towards the end of 2009 and early 2010, with the stock market leading the recovery as sentiment improves. The growth in the economy as a whole, and in the corporate sector especially, had resulted in increased activity in the stock market in the UAE. There are currently two stock exchanges in the UAE, in Dubai and in Abu Dhabi. The exchanges are regulated by the Securities and Commodity Authority (SCA) supervising the Abu Dhabi Securities Market (ADSM), Dubai Financial Market (DFM), and the Dubai Gold and Commodity Exchange (DGCE). Trading on the ADSM and the DFM includes equity and debt instruments, and the ADSM has branches in Fujeirah, Ras Al Khaimah, Sharjah and Zayed City. Development of both exchanges is a work in progress with continuous improvement in the regulatory environment and trading system. Transparency and depth of the market are areas still in need of further development and improvement. |
ADSM Index
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