Fitch Ratings said in a statement that Abu Dhabi will see sharp slowdown in 2012 as the emirate has put more emphasis on fiscal consolidation in 2011.

It added that "The expected slowdown in the major oil exporters in 2012 is mainly because this year's increase in oil production post the Libya conflict will not be repeated. Non oil growth will be sustained by strong oil revenues and government balance sheets that allow Saudi Arabia and Kuwait to maintain strong infrastructure programs. Abu Dhabi has put more emphasis on fiscal consolidation this year, however, and will probably see a sharper slowdown in 2012 than the other two major oil exporters. But as a result, its breakeven oil price will fall while those of Kuwait and Saudi Arabia will continue rising. All three sovereigns enjoy enormous fiscal flexibility in the event of lower than expected oil prices."

Fitch said that although growth in the Middle East and Africa region will slow in 2012 to 4% from almost 5% this year, tracking the forecast global slowdown, the broader impact on the regions' countries will be limited.

Of the 26 countries in the region, all are on Stable Outlook except for the three Negative Outlooks on Egypt (BB), Tunisia (BBB-) and Lesotho (BB-).

The reason for MEA's relative resilience is partly the limited expected impact on commodity prices, especially oil, which Fitch sees averaging USD 100 per barrel in 2012 compared to USD 110 in 2011. The oil market remains tight and rising political risk centered on Syria and Iran is another factor keeping prices high, notwithstanding likely slower demand growth. Global financial linkages remain limited for most countries in the region, with noticeable exceptions such as South Africa. Unlike in 2009, however, Fitch expects only a mild slowdown in South African growth to just under 3%.

The major Gulf oil exporters ship most of their oil to Asia. Meanwhile, China's growing trade and financial links with Africa and its importance for global commodity prices, means a slowdown in China and Asia more generally would be of potentially greater significance for Africa than the impending slowdown in Europe.

(Sourced from www.emirates247.com)