United Arab Emirates Economic Forecast

United Arab Emirates Economic Outlook

June 4, 2019

Although the economy appears to be revving up in the second quarter after a likely subdued first quarter, external headwinds continue to constrain momentum. Chiefly, OPEC+ oil production cuts since January continue to drag on growth and, with the U.S.-China trade war weighing on oil prices, the cuts are likely to be extended past June, which would further dampen growth in the coming quarters. Moreover, a supply overhang continues to undermine the real estate sector. Nevertheless, in April, momentum in the non-oil economy picked up despite weak job creation, while business confidence reached a record high, according to PMI data. Furthermore, the government recently waived fees for many government services and created a permanent residency framework for investors and skilled foreigners, which should support investment and business activity going forward.

United Arab Emirates Economic Growth

Growth should ramp up this year, supported by a large fiscal stimulus focused on infrastructure investment for Expo 2020, as well as by a swathe of business-friendly reforms to attract foreign investment. Nevertheless, the evolution of OPEC+ output decisions will be key to the outlook, while lower global growth and a fragile real estate sector pose additional risks. Met the why particular panelists expect GDP to increase 2.6% in 2019, which is unchanged from last month’s forecast, and 3.1% in 2020.

United Arab Emirates Economy Data

20132014201520162017
Population (million)9.09.39.69.911.1
GDP per capita (USD)43,19143,33537,37535,378-  
GDP (USD bn)390113358349-  
Economic Growth (GDP, annual variation in %)5.83.33.83.01.5
Consumption (annual variation in %)5.212.3-19.1-11.3-  
Investment (annual variation in %)-5.711.94.32.3-  
Industrial Production (annual variation in %)3.60.96.84.3-  
Unemployment Rate2.82.42.11.61.7
Fiscal Balance (% of GDP)8.41.9-3.4-2.5-1.8
Public Debt (% of GDP)15.715.518.720.7-  
Money (annual variation in %)22.87.95.53.34.1
Inflation Rate (CPI, annual variation in %, eop)1.43.13.61.22.7
Inflation Rate (CPI, annual variation in %)1.12.44.11.62.0
Policy Interest Rate (%)1.001.001.001.001.75
Exchange Rate (vs USD)3.673.673.673.673.67
Exchange Rate (vs USD, aop)3.673.673.673.673.67
Current Account (% of GDP)18.313.34.72.4-  
Current Account Balance (USD bn)71.253.616.78.4-  
Trade Balance (USD billion)11111876.668.3-  
Exports (USD billion)371343300299-  
Imports (USD billion)231235224230-  
Exports (annual variation in %)3.2-7.6-12.4-0.6-  
Imports (annual variation in %)5.91.7-4.62.9-  
International Reserves (USD)68.278.493.985.4-  
External Debt (% of GDP)44.348.360.862.2-  

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United Arab Emirates Facts

ValueChangeDate
Exchange Rate3.670.0 %Jun 13
Stock Market0.20.75 %Jun 13

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