United Arab Emirates Economic Forecast

United Arab Emirates Economic Outlook

September 7, 2021

Activity likely continued to gain traction in Q2. The non-oil private sector PMI averaged higher overall compared to Q1, signaling business conditions improved at a faster pace. Moreover, June’s reading showed the first increase in employment levels in five months, likely supporting consumption. Meanwhile, Q2 oil production was higher than in Q1. Turning to Q3, the economy appeared to steam ahead, as in July–August the PMI averaged at the highest level in two years, and oil production continued to increase in July, with output marking an 11-month high. Moreover, from 1 August OPEC+ began further easing production cuts, and in the same month the successful vaccination program enabled the government to open up inbound travel to all vaccinated visitors, boosting the important tourism industry and suggesting a bright economic panorama ahead.

United Arab Emirates Economic Growth

In 2021, the economy should return to growth. Activity should be fostered by a robust rebound in the non-oil sector as the key tourism industry recovers, amid the lifting of restrictions and Dubai’s six-month long World Expo 2020, which starts in October. That said, the oil sector is seen dragging on overall growth, while regional tensions cloud the outlook. FocusEconomics panelists forecast GDP to expand 2.6% in 2021, which is down 0.1 percentage points from last month’s projection, and 4.3% in 2022.

United Arab Emirates Economy Data

2015 2016 2017 2018 2019
Population (million)9.69.910.110.410.7
GDP per capita (USD)37,37536,22038,02740,47439,173
GDP (USD bn)358357386422421
Economic Growth (GDP, annual variation in %)5.13.12.41.21.7
Consumption (annual variation in %)-  -  -  -  -  
Investment (annual variation in %)4.38.8-17.33.60.0
Industrial Production (annual variation in %)6.03.2-0.81.63.1
Unemployment Rate1.91.62.52.22.6
Fiscal Balance (% of GDP)-3.4-2.8-2.02.0-  
Public Debt (% of GDP)18.720.220.019.1-  
Money (annual variation in %)5.53.34.12.57.9
Inflation Rate (CPI, annual variation in %, eop)3.61.22.70.3-1.4
Inflation Rate (CPI, annual variation in %)4.11.62.03.1-1.9
Policy Interest Rate (%)1.001.001.752.752.00
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)4.93.77.19.67.0
Current Account Balance (USD bn)17.613.227.540.529.6
Trade Balance (USD billion)76.668.467.285.674.8
Exports (USD billion)300295314321316
Imports (USD billion)224227246235241
Exports (annual variation in %)-12.4-1.86.32.4-1.6
Imports (annual variation in %)-4.91.28.7-4.52.5
International Reserves (USD)93.985.495.499.5108
External Debt (% of GDP)67.669.973.569.777.7

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United Arab Emirates Facts

Value Change Date
Exchange Rate3.670.0 %Dec 31
Stock Market0.10.75 %Jan 07

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