United Arab Emirates Economic Forecast

United Arab Emirates Economic Outlook

January 14, 2020

Economic growth was likely tepid in the second half of last year, although firm data is still outstanding. The non-oil private sector PMI weakened throughout H2, and in December posted the lowest reading in over a decade due to meek demand conditions and weak production. However, the oil sector should have provided some support thanks to higher output, notwithstanding OPEC+ production cuts. In other news, the UAE cabinet recently approved a multi-entry five-year tourist visa for all nationalities, which aims to create jobs and boost the tourism industry going forward. Moreover, Dubai approved its 2020 budget in late December, forecasting a 17% annual spending increase in preparation for the Expo 2020, which should support growth this year.

United Arab Emirates Economic Growth

The economy is projected to gain momentum this year as Expo 2020 bolsters the tourism sector. That said, further OPEC production cuts will cap the performance of the oil sector. Meanwhile, volatile oil prices and regional geopolitics pose downside risks for the UAE economy. FocusEconomics panelists expect GDP to increase 2.2% in 2020, which is down 0.2 percentage points from last month’s forecast, and 2.4% in 2021.

United Arab Emirates Economy Data

2014 2015 2016 2017 2018
Population (million)9.09.39.69.910.1
GDP per capita (USD)43,19143,33537,37536,22037,252
GDP (USD bn)390403358357378
Economic Growth (GDP, annual variation in %)5.14.35.13.10.5
Consumption (annual variation in %)-  -  -  -  -  
Investment (annual variation in %)-5.710.94.38.8-8.2
Industrial Production (annual variation in %)3.60.96.84.3-1.0
Unemployment Rate2.32.11.81.62.5
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 %)22.87.95.53.34.1
Inflation Rate (CPI, annual variation in %, eop)1.43.13.61.22.7
Inflation Rate (CPI, annual variation in %)1.12.34.11.62.0
Policy Interest Rate (%)1.001.001.001.001.75
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)18.313.34.93.77.3
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 %)5.92.0-4.91.28.7
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

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

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