New research says UAE growth to be supported by an increase in investment flows and private consumption
The UAE is forecast to achieve an average real GDP growth rate of 3.8 percent between 2019 and 2023, supported by an increase in investment flows and private consumption, according to new analysis from Dubai Chamber of Commerce and Industry.
The analysis identified other key factors that are expected to drive economic activity in the UAE, including expansionary fiscal policy and a growing number of infrastructure and construction investments in the run up to Expo 2020.
It said a recovery in private consumption and sales of highly cyclical consumer products is expected, extending to products such as vehicles, furniture, household appliances, and medical equipment. Robust growth in investment is also projected on the back of government fiscal stimulus.
Real GDP for the UAE’s non-oil sector is projected grow by an average of 4.1 percent between 2019-2023, compared to the 2.8 percent in the 2014-2018 period.
The report said momentum behind the UAE’s GDP growth over the next 5 years will likely be led by the country’s transport and communication sector which is set to record GDP growth of 7.9 percent, followed by construction (4.2 percent), and real estate and business services (3.8 percent).
It added that recent measures to reduce cost of doing business in the UAE are expected to support activity within the country’s SME and private sectors in the near future.
The outlook for the global economy over the 2019-2023 period appears more modest, with real GDP growth projected to reach an average of 3.6 percent, according to recent projections from the IMF.