The Organization of the Petroleum Exporting Countries (OPEC) sees the UAE economy continuing its stellar performance in 2023. This after it recorded a robust 7.9 percent growth year-on-year in 2022.
OPEC’s Monthly Oil Market Report notes that the UAE’s non-oil sector will be the primary driver for its continued growth. Specifically, contributions from tourism, leisure and real estate will significantly boost the economy for the rest of the year.
UAE economy to sustain momentum
The report revealed that the country’s Global Purchasing Managers’ Index (PMI) was almost unchanged in July, standing at 56, following 56.9 in June and compared to a level of 55.5 in May. This suggests that the UAE’s economy will sustain its expansionary trend.
Additionally, the International Monetary Fund (IMF) painted a bright outlook for the UAE’s economy. In a recent statement, the IMF said saying it “remains positive” about the UAE’s economic performance on the back of a strong domestic activity.
Earlier this year, the UAE Ministry of Economy revealed that the emirates also recorded an impressive 17 percent growth on the international trade front in 2022. “Our exports value surged 6 percent on an annual basis to AED 366 billion. The share of exports in the total non-oil trade rose to 16.4 percent from 12 percent in 2015. The share of re-exports also reached 27.5 percent of total non-oil trade,” His Excellency UAE Economy Minister, Abdulla bin Touq Al Marri said in an exclusive interview with Economy Middle East.
Real estate market growth
Meanwhile, the UAE’s real estate market remains on an upward trajectory, the report further showed, with H1’23 seeing a substantial surge in overall property transactions.
This played a role in driving up residential property prices in Dubai by 16.9 percent YoY as of June, as reported by REIDIN.
Finally, the Central Bank of the UAE (CBUAE) mirrored the 25 bp increase in interest rates implemented by the US Federal Reserve in July, putting the key-policy rate at 5.4 percent and resulting in a total rise of 525 bp in just over a year.
The short-term interest rate is now approaching its highest level since before the global financial crisis.
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