UAE’s real GDP is forecast to grow by 5.9% this year, according to the World Bank.
“Higher oil receipts, supplemented with a gradual non-oil recovery in the Emirates will bolster fiscal revenue resulting in a fiscal surplus to hover around 4.4% of GDP in 2022,” the bank said in the latest Gulf Economic Update (GEU).
However, the World Bank predicts the UAE’s real GDP to edge down to 4.1% in 2023 as a slowdown in global demand could hinder growth as a result of tightening financial conditions, Arabian Business reports.
“Recent bilateral free trade agreements with Asian partners supported by strong oil exports will place the UAE’s current account surplus at 11.2% of GDP in 2022,” the bank report added.
In addition, the World Bank praised the UAE’s ‘favourable business environment and world-class infrastructure for the economy’s resilience.
According to the Gulf Economic Update, the GCC economies are forecast to grow by 6.9% this year, followed by 3.7% growth in 2023 and 2.4% in 2024.
“Easing of pandemic restrictions and positive developments in the hydrocarbon market drove strong recoveries in 2021 and 2022 across the GCC,” the GEU report stated.
“Strong economic recovery and supply chain bottlenecks raised inflation in the GCC to an average rate of 2.1% in 2021 – up from 0.8% in 2020.”
Moreover, the regional fiscal balance is forecast to record a 5.3% surplus of GDP this year, whilst the external balance surplus is predicted to hit 17.2% of GDP, the report added.
“There is an excellent and timely opportunity to diversify the economy further using a green growth strategy, and playing a leading role in the global transition to low-carbon economies,” said Issam Abousleiman, World Bank Regional Director for the GCC.
“The region could use the green growth transition to focus policies on developing green technologies and associated skilled labour that would reverse trends in productivity and enable the region to grow faster,” he added.
The report says that total GDP for the GCC countries is forecast to be close to $2 trillion in 2022.