The population of the United Arab Emirates is not declining and there has been a net increase in the number of labour cards issued over the past six months,' Labour minister Saqr Ghabbash said on Monday.

'I don't want to speculate. I'm talking about numbers we have and according to the numbers we have during the last six months there was no decline,' he told reporters, when asked about reports that country was emptying out.

EFG-Hermes said last month that the population of Dubai, part of the seven-member UAE federation, was set to fall up to 17 per cent this year as the former boomtown suffers from a real estate slump that could lead the UAE economy to contract.

UBS said earlier this month that the population of Dubai could fall 10 per cent in the next two years due to job cuts.

Hundreds of billions of dollars worth of real estate projects have been cancelled or delayed in recent months and thousands of jobs have been cut in as the global financial crisis hits the former Gulf Arab trade and tourism hub.

From Asian construction workers to Western executives, the UAE, the world's third-largest exporter of oil, relies heavily on foreign workers who far outnumber UAE nationals.

In Dubai, foreigners comprise at least 80 per cent of the population and, as foreigners are only allowed to reside in the UAE if they are employed those who lose their jobs have a few weeks to find a new job or leave.

Ghabbash said 662,000 new labour cards were issued and 405,000 were cancelled in the UAE from October to the end of March, which amounts to a net increase.

There was a 21 per cent increase in the number of new labour cards issued in 2007 and a 32 per cent increase in 2008, he said.

A total of 4.1 million workers are registered with the labour ministry, Ghabbash told reporters at a labour conference in Dubai, adding that some employers had not severed contracts but given staff extended leave until business recovers.

Emirates airline, owned by the government of Dubai, said earlier this month it had reviewed its needs and decided to offer staff the opportunity to apply for unpaid leave on a purely voluntary basis.

'If companies do not have enough jobs for the workers with them they can give them a leave for a certain time which is a maximum of six months. Maybe some of the companies are using that flexibility during this crisis,' he said.

'Maybe this is a good sign. Instead of losing the whole you are losing it for a certain time and then it comes back,' he added.-Reuters