The UAE over the past few weeks has received numerous reports that its economy is on the mend. The latest positive news came on Thursday, when the International Monetary Fund revised its non-oil growth forecast for the UAE in 2020 to 3 per cent. That is a significant increase from the relatively modest grow (about 1 per cent) in 2019.
The IMF team concluded that the economy is on a recovery path and likely to pick up more momentum next year, helped by Expo 2020 Dubai and existing fiscal stimulus. Overall GDP growth is expected to register 2.5 per cent in 2020.
Other reports have mirrored the IMF’s analysis. In an HSBC survey of over 9,100 companies in 35 countries and territories, 83 per cent of the UAE’s businesses anticipate sales growth over the next 12 months, with at least 35 per cent looking to grow by 15 per cent or more. The bank said the UAE’s significant diversification efforts has meant that the country is increasingly viewed as an innovative hub for trade, benefiting both domestic and international businesses.
The outlook has been helped by the numerous initiatives of the UAE government, including the issuance of new visas, the freezing of governmental fees for three years, and the setting up of committees to address many economic challenges, including the oversupply in the property market
The National Bank of Kuwait noted the UAE’s economic outlook remains stable, despite a slowing global economy, trade disputes, softer energy demand, and heightened geopolitical tensions.
The latest Purchasing Managers’ Index showed, despite noting a tough economic environment, business expectations towards future output improved in October. Firms were positive that new strategies and greater investment ahead of the Expo 2020 Dubai would lead to higher levels of activity.
This is good news for everyone in the UAE, who have worked to maintain the economy over the past few years, as volatile oil price, trade wars and geopolitical tensions have taken their toll on both the Gulf and the global economy as a whole.
The outlook has been helped by the numerous initiatives of the UAE government, including the issuance of new visas, the freezing of governmental fees for three years, and the setting up of committees to address many economic challenges, including the oversupply in the property market.
But many of the root causes affecting the global economy are still there. The US and China are beginning to show they are serious working towards removing trade barriers, but a global oil glut and political tensions in the region are still having a negative impact on some parts of the economy.
The government cannot yet cease looking for new ways to boost the economy or working towards finding new ways to solve the underlying issues, but the UAE’s has demonstrated that its economy continues to be resilient.