The central bank governor of the United Arab Emirates said Wednesday the Mideast's second-largest economy was still suffering from the impact of the global financial crisis and that growth will be limited this year.
"We are still in a crisis, though it's less intense now," Sultan bin Nasser Al Suwaidi told reporters on the sidelines of an Islamic banking event in Sharjah, one of the sheikdoms making up the U.A.E. "Banks may need to take further provisions this year."
Economic growth in the U.A.E. last year was hit by a sharp downturn in Dubai real estate prices and lower revenue from oil. According to Zawya Dow Jones calculations, Abu Dhabi, which pumps most of the U.A.E.'s oil, earned about $43 billion for exports of crude last year.
"There won't be big growth in the economy. The rates won't be high. Markets have started to stabilize worldwide and this will be reflected in the U.A.E. We should not talk about inflation," he said.
The U.A.E.'s economy minister Sultan Mansouri said in December that the economy was expected to grow by 1.3% last year and and 3.2% in 2010. On Wednesday, Al Suwaidi, who is one of the most experienced and senior officials in the emirate, added that home prices in the U.A.E. were once again affordable after the average cost of property in hot spots like Dubai fell 50% last year.
The emirates, which last year exited a plan to create a unified currency amongst the Arab states of the Persian Gulf, said the country won't rejoin in the future.END
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