Bahrain topped the Arab World in real economic growth during 2005, according to a report compiled by the Economic and Social Commission for Western Asia (ESCWA), a UN agency.

Bahrain, with a 7 per cent growth, was followed by the UAE and Egypt at 6 per cent each, Kuwait with 5.5 per cent, Saudi Arabia and Qatar with five per cent each and Oman with 4.5 per cent, a report in Arab News quoting the Escwa study said.

The high growth in the Arab countries was attributed to the record high prices of oil in the international market.

Palestine recorded the lowest growth rate of around 0.4 per cent last year.

The UAE’s real GDP peaked at around $87.3 billion in 2005 compared with $82.4 billion in 2004 and nearly $79.2 billion in 2003. In 2002, it stood at around $74 billion while it was estimated at nearly $72.6 billion in 2001, the report said.

In current prices, the UAE economy raced by about 11.9 per cent to $115.5 billion in 2005 following a sharp increase in oil prices to an average $50 a barrel from $36 in 2004. The UAE’s oil output also soared to one of its highest levels of nearly 2.4 million bpd in 2005 although it remained far below its sustainable capacity since the country is sticking to Opec production policy.

According to the Ministry of Economy and Planning, the non-oil sector performed even better than the oil sector, growing by 12.1 per cent last year. Growth covered almost all sectors, including manufacturing, water and electricity, services, farming and construction.

Experts attributed the upsurge in non-oil sectors to higher public spending due to strong oil prices and a sharp increase in private investment, mainly in industry, real estate and construction.