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UAE issues annual economy achievements report

UAE issues annual economy achievements report
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Abu Dhabi - Mubasher: The UAE economy has achieved several developmental milestones in 2018, which have contributed to stimulating its growth, enhancing its competitiveness and ensuring the sustainable development of the economy, according to economy minister Sultan Al Mansoori.

The minister also noted that the UAE continues to march ahead in its development path, based on integrated strategies for continuous development and modernization, most notably the National Agenda 2021, the UAE Centennial 2071, the post-oil economy plan, the consolidation of economic diversification, as well as effective national strategies on innovation, envisioning the future, the Fourth Industrial Revolution, Artificial Intelligence (AI), space program, energy and renewable energy, green economy, and Corporate Social Responsibility (CSR)

GDP

Gross domestic product (GDP) reached approximately AED 1.405 trillion, achieving a growth rate of about 7.2% over 2016, according to the Federal Competitiveness and Statistics Authority.

Non-oil GDP amounted to about AED 1.092 trillion with an increase of 3.2%, which makes the contribution of non-oil sectors in the GDP of the state achieved a rate of 77.7%.

Expected Growth

The International Monetary Fund (IMF) affirmed that the UAE economy has displayed flexibility and adaptability in the face of low and volatile oil price challenges over the past years and that the country has adopted effective fiscal and economic policies that have had the greatest impact on maintaining the strength of the economy.

The UAE’s current account surplus is expected to exceed 7% of GDP this year as the momentum of non-oil economic activity increases, raising the real GDP growth estimate for the country in 2018 to 2.9%, with a further rise expected during the coming year, at a rate of 3.7%.

In terms of economic diversification, the IMF has predicted that the contribution of non-oil GDP will increase to 2.9% by the end of 2018 and that it will continue to grow next year to about 4%.

Foreign Direct Investment (FDI)

2018 witnessed a surge in efforts to develop the investment environment in the country, through the promulgation of the new federal law on Foreign Direct Investment (FDI).

The law is granting of 100% ownership of projects in specific sectors, facilitating investment protection guarantees, financial transfer options and the possibility of amending the partnership, mergers, acquisitions and transfer of ownership consistent with the investor interest.

The law is also expected to lead to a 15% to 20% growth in the volume of FDI inflows to the UAE during 2019/2020 and that the state aims to increase the share of the contribution of FDI in current prices to 5% by 2021, as compared to 3% currently.

Foreign Investment Intensives

UAE has a wide range of foreign investment intensives for doing business and signed 78 agreements to protect and encourage investment and 115 agreements to avoid double taxation of income with certain countries until 2017.

FDI flowing into the UAE in 2017 were recorded at around $10.4 billion, up 7.8% from 2016.

The state accounted for 40% of the total investments received in Arab and West Asian countries, and 23.3% in the Middle East and North Africa (MENA) region in the same year as well.

The UAE ranked the first in the Arab world and 30 on the list of the best countries in the world in attracting FDI.

The UAE’s cumulative balance of FDI inflows until 2017 was about $130 billion, with a 9% growth over 2016.

In addition, the UAE ranked first in the Arab region and 21st globally in terms of FDI outflows to the world, estimated at $14 billion during 2017, with a growth of 7.7% over 2016.