UAE ECONOMIC OUTLOOK POSITIVE | 2017 – 2020
- August 10, 2016
- Posted by: RKonnect
- Category: Business & Economy
UAE Economic Forecast 2017 – 2020
Dubai – UAE economy will continue to remain attractive in 2017 amid recovering oil prices and growth in public and private sector activities. It is expected that UAE’s GDP will grow between 4 to 5 per cent in 2017 – 2020 period from approximately 3 percent in 2016. The economic forecasts and growth assumptions are based on UAE’s current oil exports which revolve around an average oil price of $37 in 2016 and projected to be $50 by 2017, increasing at a CAGR of 10 per cent by 2020.
UAE Government Diversification Strategies
The economic forecast also considers how well UAE government is responding to the ongoing economic challenges which includes the de-regularisation of the fuel prices as well diversifying to the non-oil sectors such as innovation, hospitality, healthcare, medical tourism, real estate, retail, education and media.
Furthermore, favorable business environment, business friendly regulations and zero income tax continue to encourage foreign direct investments in UAE driving the economy forward exponentially. It is further complimented by the growth in local as and tourist population, development of mega infrastructure projects and EXPO 2020, which will the biggest event that the country when hosted.
Global Ranking – UAE Economic Performance
UAE performance on various global economic indexes has been instrumental due to country’s ability to deal with financial crises and socio-economic changes. This is due to the fact that the UAE government is heavily investing in the diversification strategy (Abu Dhabi 2030 Economic Vision Plan and Dubai 2021 Plan) to reduce the reliance on oil revenues in coming years and diversify its economy to non-oil based GDP. The results are for everyone to see:
- UAE ranked 3rdfor Economic Openness Globally
- UAE ranked 4thfor Business Environment, Infrastructure & Technological Advancement
- UAE ranked 5thon Global Readiness Index
- UAE ranked 5thon Change Readiness Index
- UAE ranked 15thon World Competitiveness Index
UAE – Status of Mega Projects
Mega projects in the country are forecasted to recover by 2017 as Dubai prepares for EXPO 2020 according to MEED (Middle East Business Intelligence). MEED further anticipates that the project spending on mega projects will rise from next year. Currently, mega projects worth $155 billion are under construction in UAE while there are upcoming projects worth $629 billion. Only in Dubai, projects worth 16 billion were initiated in 2016 related to real estate, transport and power sectors. UAE leads the GCC region in terms of infrastructure development and economic growth, as UAE is responsible for near around 35 per cent of projects worth $507 billion between 2006 to 2015 period.
EXPO 2020 – UAE & Dubai’s X Factor
EXPO 2020 is expected to attract more than 25 million visitors. The event is likely to attract foreign investments between $100 to $150 billion in Dubai and UAE across various sectors of the economy such as real estate, tourism, retail and education. The event will further aid UAE to expand investment prospects in new projects apart from increasing the volume of re-investment in the country. Furthermore, the event will aid UAE to foster international relations, enhance economic opportunities and open doors to new markets.
Investment Opportunities in UAE
The overall economic outlook of UAE looks resilient, offering great avenues of investment for local as well as international investors in mid-to-long term period.