United Arab Emirates Economic Forecast

United Arab Emirates Economic Outlook

October 5, 2021

The economy likely continued to gain steam in Q3. The non-oil private sector PMI averaged at the highest level in two years, signaling that business conditions improved more rapidly. Moreover, the readings indicated that employment increased in the quarter, likely supporting consumption. The oil sector also improved: Oil production averaged higher in July–August than in Q2, with August’s reading marking a 16-month high. Furthermore, August’s OPEC+ meeting will have likely provided a boost to the oil sector through September, while a high vaccination rate bodes well for the non-oil sector heading into Q4. In other news, on 5 September the government announced proposals to boost inbound FDI as part of its strategy to diversify away from oil, with the ongoing Expo 2020 seen as a key event to boost investment and growth.

United Arab Emirates Economic Growth

In 2021 and 2022, 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 Expo 2020, which started in October this year. The oil sector is seen dragging on overall growth in 2021, but should rebound in 2022, although regional tensions cloud the outlook. FocusEconomics panelists forecast GDP to expand 2.7% in 2021 and 4.4% in 2022, which is down 0.1 percentage points from last month’s forecast.

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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