UAE economy to grow by 4.3% in 2024, Central Bank says

Regulator maintains its expectations of 3.9% growth for this year

The UAE economy is estimated to have grown by 7.6 per cent last year. Khushnum Bhandari / The National

The UAE Central Bank expects the country's economy to grow by 4.3 per cent in 2024 and has maintained its growth forecast of 3.9 per cent growth for the current year.

The banking regulator projects that the non-oil economy will grow by 4.6 per cent and oil gross domestic product by 3.5 per cent next year, state news agency Wam reported on Monday.

It expects non-oil GDP to rise 4.2 per cent and oil GDP to grow 3 per cent in 2023.

The UAE economy is estimated to have grown by 7.6 per cent last year, the highest in 11 years, after expanding 3.9 per cent in 2021, the Central Bank said.

Non-oil GDP and oil output are estimated to have grown by 6.6 per cent and 10.1 per cent, respectively, last year.

The Central Bank attributed the robust economic growth in non-oil GDP to the property, construction and manufacturing sectors.

The Qatar World Cup and other events held in the region also bolstered the UAE's travel and tourism industry, it said.

The Emirates is set to benefit further from the presence of a vital private sector, supported by various reforms and strategies to increase foreign direct investment flows and to attract the best talent, Wam reported.

The banking sector continues to support investment in the sector, with credit to the private sector increasing by 4.9 per cent on an annual basis in the fourth quarter of last year, it said.

The UAE’s non-oil foreign trade hit a record Dh2.23 trillion ($607.1 billion) last year as the Arab world’s second-largest economy hastened to put in place measures to reduce its dependence on hydrocarbons and boost its economic partnerships globally.

This was the first time the UAE’s non-oil foreign trade crossed the Dh2 trillion mark, with values for the January-December period increasing more than 17 per cent from the same period in 2021.

The UAE economy continues to withstand global headwinds and is expected to achieve 4.2 per cent in non-oil economic growth by the end of this year, Mohamed Al Hussaini, Minister of State for Financial Affairs, said during a meeting of G20 finance ministers and central bank governors in Bengaluru, India, last month.

First Abu Dhabi Bank forecasts the UAE's hydrocarbon and non-hydrocarbon real GDP growth at 5.4 per cent and 4.7 per cent, respectively, this year.

Emirates NBD expects the country's GDP to grow by 3.9 per cent in 2023.

UAE government revenue rose by about 7 per cent in the fourth quarter of 2022 as it continued to rebound from the coronavirus pandemic on the back of federal initiatives and higher oil prices.

Total revenue for the three months to the end of December climbed to Dh148.1 billion, the Ministry of Finance said.

Business activity in the UAE’s non-oil private sector economy also grew at its strongest pace in four months in February.

The seasonally adjusted S&P Global purchasing managers’ index reading climbed to 54.3 last month, from 54.1 in January, well above the neutral 50-mark that separates growth from contraction.

The UAE's real estate sector continued its strong performance in the fourth quarter of last year, achieving solid growth in terms of activity, despite the global slowdown.

The activity in Dubai's property market reached historic levels, with the total value of deals hitting Dh214 billion in the fourth quarter, an annual increase of 169 per cent.

The number of tourists travelling to the emirate increased to 14.4 million in 2022, almost double the total number of visitors in 2021.

Meanwhile, hotel occupancy in Dubai rose to 73 per cent last year, from 67 per cent in 2021, while that for Abu Dhabi increased to 70 per cent in 2022.

Passenger traffic through the five Abu Dhabi airports tripled to 15.9 million passengers in 2022, up from 5.3 million passengers in 2021, while 21.8 million passengers travelled through Dubai's airports last year, an increase of 81.3 per cent over 2021.