United Arab Emirates Economic Forecast

United Arab Emirates Economic Outlook

July 7, 2020

The economy shrank 1.0% in the first quarter (Q4 2019: +0.8%) as the non-oil sector took a heavy hit from lockdown measures enacted in March: Tourism was all but suspended and non-essential businesses closed at the end of the quarter due to the escalating coronavirus pandemic. The oil sector tempered the fall somewhat amid surging production in March following the breakdown of OPEC+ output cuts. However, the second quarter likely saw both spheres of the economy decline: PMI readings in April–June suggest private-sector activity generally contracted in the quarter, while oil production tumbled in May following the renegotiated OPEC+ production cuts earlier in that month. Moving to the third quarter, the lifting of pandemic curfews in late June bodes well for private consumption and business activity from July onwards.

United Arab Emirates Economic Growth

The economy is projected to contract this year as both the oil and non-oil sectors shrink amid dissipating global demand and constrained household consumption. The duration of the outbreak and its impact on the global flow of people and trade presents a considerable downside risk to the outlook. FocusEconomics panelists forecast GDP to shrink 5.0% in 2020, which is down 0.6 percentage points from last month’s estimate, and to grow 3.2% in 2021.

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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