Shuaa Capital projects Dubai’s growth rate at 2.5 per cent

Shuaa Capital projects Dubai’s growth rate at 2.5 per centThe economic growth rate of Dubai, reeling under pressure due to slowdown and Dubai World crisis, is likely to shrink second year in a row in 2010, according to a report titled 'UAE Vision 2010', published by a leading city-based investment bank Shuaa Capital.

However, overall economic prospectus may improve this year and Dubai is expected to register an economic growth rate of 2.5 per cent.

The economy is likely to shrink 0.4 per cent compared to five per cent last year mainly because of decline in residential sale price and Emirates population. Dubai's construction and real estate sector is expected to slightly push its economy.

Meanwhile, Abu Dhabi's economy, shrank 2.7 per cent in 2009, has been projected to grow at 1.4 per cent by gaining momentum from recovery of oil prices. The Chief Economist and Head of research at Shuaa Capital- Mahdi Mattar expressed, "The capital will benefit from a recovery in oil prices and increased output this year, as well as strong growth in the non-hydrocarbon sector, which will be supported by government investment and spending."

The UAE capital markets, as per report, are also projected to grow by up to 25 per cent this year but much would depend over resolution of the Dubai World debt plans.