United Arab Emirates Economic Forecast

United Arab Emirates Economic Outlook

June 7, 2022

Conditions in H1 2022 should be robust so far. The oil sector benefitted from the combined effects of the gradual pickup in production through April and elevated prices. For the first time in two years, the UAE shipped oil to Europe, as the latter tries to move away from dependence on Russian oil. The non-oil sector likely contributed to a solid performance as well, as the PMI signaled continually strengthening conditions through April. Further, the UAE and Israel signed their first free trade agreement, reflecting increasing ties between the countries. Meanwhile, the UAE’s crypto-friendly stance is attracting business and could lead the UAE to become a crypto-hub. In politics, Sheikh Mohammed bin Zayed al-Nahyan—the former crown prince of Abu Dhabi—was named president of the UAE on 14 May, following his brother’s death. The transfer of power should not bring any changes in policy.

United Arab Emirates Economic Growth

Economic growth is seen further accelerating this year from 2021’s rebound, largely on a booming oil sector. Growth in the non-oil sector will be broadly unchanged, but the government’s reform agenda will sustain its robust performance. That said, regional tensions, volatile oil prices, U.S. monetary policy and new Covid-19 variants are key risks. FocusEconomics panelists forecast GDP to expand 5.4% in 2022, which is up 0.2 percentage points from last month’s forecast, and 4.5% in 2023.

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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