United Arab Emirates Economic Forecast

United Arab Emirates Economic Outlook

July 2, 2019

Growth appears to have moderated but remained healthy in the first quarter, as OPEC+ production cuts in effect since January dampened oil-sector growth, while non-oil activity picked up after a near-flat reading in Q4, thanks in good part to higher government spending. Turning to the second quarter, the non-oil sector appears to have made some positive strides. The PMI rose notably in April and then again in May, reaching an over four-year high, although payrolls have remained stagnant. Data for Dubai also indicates healthy tourism, as well as a pick-up in construction activity in May due in large part to the ramp-up of Expo 2020 projects. Nevertheless, OPEC+ cuts remained in place in the quarter—limiting the oil sector’s momentum and weighing on growth—and are likely to be extended until year-end at the next OPEC+ meeting ending 2 July.

United Arab Emirates Economic Growth

The economy should gain impetus this year, pillared by a sizeable fiscal stimulus aimed at infrastructure investment for Expo 2020, as well as business-friendly reforms which should 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. FocusEconomics panelists expect GDP to increase 2.5% in 2019, which is down 0.1 percentage points from last month’s forecast, and 3.0% in 2020.

United Arab Emirates Economy Data

Population (million)
GDP per capita (USD)43,19143,33537,37536,22037,252
GDP (USD bn)390403358357378
Economic Growth (GDP, annual variation in %)
Consumption (annual variation in %)-  -  -  -  -  
Investment (annual variation in %)-5.710.
Industrial Production (annual variation in %)
Unemployment Rate2.
Fiscal Balance (% of GDP)8.41.9-3.4-2.5-1.6
Public Debt (% of GDP)15.815.518.720.219.7
Money (annual variation in %)
Inflation Rate (CPI, annual variation in %, eop)
Inflation Rate (CPI, annual variation in %)
Policy Interest Rate (%)
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.
Current Account Balance (USD bn)71.253.617.613.227.5
Trade Balance (USD billion)14010876.668.467.2
Exports (USD billion)371343300295314
Imports (USD billion)231235224227246
Exports (annual variation in %)3.2-7.6-12.4-1.86.3
Imports (annual variation in %)5.92.0-
International Reserves (USD)68.278.493.985.495.4
External Debt (% of GDP)44.348.367.669.972.6

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United Arab Emirates Facts

Exchange Rate3.670.0 %Jul 11
Stock Market0.10.75 %Jul 11

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