The UAE's GDP is expected to peak at AED 1.248 trillion in current prices this year to maintain its position as the largest in the Arab world after Saudi Arabia's economy.

The Dubai Economic Council said in the study, dubbed the document of the union era that the expected level this year will be nearly 198 times the country's nominal gross domestic product of AED 6.5 billion when it was established in 1971.

The report said that real GDP is forecast to grow by around 3.3% in 2011 and 3.8% in 2012 as compared with around 2.3% in 2010.

It showed the nominal GDP has raced by nearly 34% annually over the past five years because of strong oil prices, pushing the country's per capita income to a projected AED 174,000 from AED 100,000.

The report showed, although the UAE has remained heavily reliant on oil exports for its income, the hydrocarbon sector's contribution to GDP has sharply declined over the years because of a massive drive to diversify the economy. From around 70% in 1971, its contribution slumped to only 29% in 2010.

It said that non oil GDP hit an all time high of around AED 749 billion in 2010 as compared with nearly AED 511 billion in 2006. It added that "This development reflects the UAE's efforts to ease reliance on the oil sector given its price volatility and persistent instability in the global economy."

The report showed the UAE's fiscal balance would record a surplus of 10.3% of GDP this year and 9.2% in 2012 against 7% in 2010. As for trade, it showed the country's commercial exchange would rocket by nearly133 times from around AED 13 billion in 1971 to a projected AED 1.73 trillion in 2011. In 2010, the UAE was ranked the 13th largest exporter with exports of around USD 235 billion while it came 18th in imports which stood at USD 170 billion, adding that the country's exports and imports accounted for almost two and 1.4% of the world's total exports and imports respectively.

(Sourced from www.emirates247.com)