Abu Dhabi Takes up 46.3% of the Non-Oil Actual Yield of the StateTruth Consultancy
“Truth” Launches Emirati Index for Performance Efficiency Measurement
Source: Abd-El-Fattah Montasser – Abu Dhabi
Date: 30 September, 2015
Truth Economic Consultancy Company launched a new Emirati indicator for observing the economic developments in the UAE at the federal level and the at the level of each emirate separately.
The General Manager of Truth Economic Consultancy Company, Reda Mosallam, said, in a press conference held, yesterday, in the Company’s headquarters in Abu Dhabi that “the economic performance efficiency indicator” launched yesterday aims at explaining, describing, and measuring the efficiency of the economy, to which the indicator is applied, by building miniature models to use the total domestic product for each emirate of the state as the most important economic indicator predominant by the employed working force for a particular year compared to the comparative domestic product of the UAE. This is done with the aim of reaching results that show the available (unexploited) investment opportunities in all the sectors of the gross domestic product of the concerned emirate in a particular year, determining the weaknesses that should be addressed, working hard to overcome them, and removing the obstructions that do not let the full development take place easily and smoothly.
Mosallam said that the new indicator provides the decision makers with a clear outline of the status and level of each emirate’s economy represented in the comparison between the gross domestic product of the emirate with the gross domestic product of the state in a particular year. On the basis of such comparison, all the decisions will be taken. Mosallam pointed that the new indicator will be one of the hefty indicators which measure the economic development; as it is added to the other economic indicators currently in use for measuring the economic development. The miniature models were built to measure the economic development according to the economic data of the state and then of each emirate separately.
Mosallam indicated that economic indicators are a group of mathematical equations resulting in a percentage that reflects a particular economic concept. They depend on a group of statistics, official historic economic data or forecasted statistics and data on the basis of scientific and practical models. Such indicators are used in measuring the performance of the different economy sectors to evaluate the economic performance, know to what extent the economy is strong or weak. Furthermore, in light of such indicators, the future economic status can be forecasted. Mosallam hinted that the new indicator addressed the last five years and excluded the extractive industries from the gross domestic product of the state and each emirate; the compound interest equation is used to calculate the average growth rates. The population census of the state was adopted according to the data available at the National Bureau of Statistics until the historic period 2010. From 2011 until 2014, the data available at the International Monetary Fund was adopted.
Mosallam said that the new indicator, in its first phase, was applied to the economic performance of Abu Dhabi Emirate, highlighting that the indicator showed that Abu Dhabi takes up about 46.3% of the actual non-oil gross domestic product of the state. He emphasized that Abu Dhabi economic performance efficiency is nearly 21.3% more than the estimative efficiency as per the initial data related to the emirate, whose contribution to the gross domestic product of the state is estimated by about 25%. He said that if the indicator is zero or any percentage above zero, this means that the emirate’s economy is operating at its full capacity or at least at a percentage above the calculated benchmark ratio. Whereas the emirate’s economy as per “the comparative benchmarking guide of the state” exceeds 46% compared to the benchmark ratio, which the indicator should indicate; accordingly, this means that the indicator is in the positive terrain at 21.3%.
Guide – The average materiality of the gross domestic product (GDP) Sectors of the state (2010-2014)
Sectors Average Materiality
Agriculture, animal and fish wealth 1.1%
Processing industries 14.1%
Electricity, gas, and water 3.8%
Construction and building 15.0%
Wholesale and retailing trade, services, and repair 17.6%
Restaurants and hotels 3.3%
Transport, storage, and communications 12.9%
Real estates and business services 15.8%
Social and personal services 3.8%
Financial projects sector 11.1%
Governmental services sector 8.3%
Household services 0.7%
Calculated banking services -7.6%
Source: Truth’s analyses