Business confidence in the United Arab Emirates has fallen to its lowest level since the first quarter of 2016, according to the latest Global Economic Conditions Survey (GECS).
Produced by the Association of Chartered Certified Accountants and the Institute of Management Accountants, the survey showed that the performance was dragged down by capital expenditure and employment in the UAE.
It added that if that oil price remains relatively stable, the UAE’s confidence levels may start to recover in the coming months.
"Preparations for the 2020 World Expo should also help to support the UAE’s economic prospects,” said Lindsay Degouve de Nuncques, head of ACCA Middle East.
Degouve de Nuncques added: “In the UAE, the capital expenditure and employment subcomponents were both very weak. Despite the UAE having one of the biggest non-oil sectors in the Gulf, this will be related to the lower oil price.
“Oil output is likely to remain subdued as countries in the Middle East follow the latest OPEC production cuts. The other drag is likely to come from continued fiscal austerity, as the region continues its adjustment to a period of lower oil prices."
Globally, the survey said economic confidence improved slightly in the third quarter, and remains high compared with the past couple of years.
While the global picture is optimistic, however, it does hide variations, with some regions doing much better than others, with South Asia the most confident region as India and Pakistan look set to grow strongly over the next year.
Economic confidence across Asia-Pacific is also strong but in the US, business optimism fell for the second consecutive quarter.For all the latest business news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.
Subscribe to Arabian Business' newsletter to receive the latest breaking news and business stories in Dubai,the UAE and the GCC straight to your inbox.