According to Michael Bolliger, the chief investment officer for Emerging Markets at UBS Global Wealth Management, the UAE’s gross domestic product (GDP) is projected to reach 3.5 percent in 2023 and is expected to further increase to 3.9 percent in 2024.
Bolliger, in a statement to the Emirates News Agency (WAM), expressed the bank’s optimistic view regarding the UAE’s medium-term GDP growth potential. He highlighted the robust demand for the country’s oil exports and energy investments as key drivers. In addition, Bolliger anticipated a solid 4.5 percent growth in the non-energy sector of the economy for the current year.
Read more: IMF positive outlook on UAE economy
According to Bolliger, the implementation of a 9 percent corporate tax this year, alongside the adoption of a 5 percent value-added tax (VAT) in 2018 plays a significant role in strengthening the UAE’s public finances. He further emphasized that these measures, combined with ongoing initiatives to decrease the economy’s reliance on the hydrocarbon sector, will contribute to further diversifying the economy.
Bolliger highlighted that these measures have a positive impact on macroeconomic stability, the country’s fiscal accounts, and its balance of payments. He mentioned that this, in turn, enhances the country’s appeal as an attractive destination for foreign direct and portfolio investments.
Bolliger explained that the UAE’s recent introduction of structural and social reforms and programs will act as favorable catalysts, enabling the country to achieve a sustainable growth rate of approximately 4 percent per year. Additionally, he pointed out that prioritizing domestic renewable energy sources and enhancing energy efficiency will allow for more hydrocarbons to be available for export. This, in turn, will have positive implications for the UAE’s fiscal balance and balance of payment. Bolliger stated.
COP28
Regarding the hosting of COP28, Bolliger expressed that it presents a significant opportunity for the UAE to play a leading role in the global fight against climate change while showcasing its own net-zero strategy. He further emphasized that the UAE stands as one of the most competitive regions worldwide in renewable energy production, proudly hosting some of the largest and most cost-efficient solar power plants globally.
Bolliger stated that in recent years, the UAE has undertaken several groundbreaking solar power projects, including the Al Dhafra Solar PV plant and the Mohammed bin Rashid Al Maktoum Solar Park. These initiatives are instrumental in enabling the country to fully utilize its solar power potential and facilitate its transition towards cleaner energy sources.
For more news on the economy, click here.
