The UAE is targeting an economic growth rate of about 4 per cent next year as it looks to the non-oil economy for expansion, the undersecretary of the Ministry of Economy said yesterday.
The UAE’s economy grew 3.8 per cent last year, according to the Minister of Economy, Sultan Al Mansouri.
“Our aim is to maintain the same level of growth [in 2017] and that it will be around 4 per cent,” said Abdullah Al Saleh at the UAE Economic Planning Forum in Umm Al Quwain.
The non-oil sectors, particularly services and industry, will help the economy grow, he added.
The services sector includes construction, logistics, hospitality, education, health care and transportation.
The IMF believes that growth in the UAE’s non-oil economy will slow next year, as the two biggest emirates in the federation – Abu Dhabi and Dubai – experience contrasting economic fortunes, said Masood Ahmed, the IMF’s director of the Middle East and Central Asia department, last month.
Overall growth in the UAE will fall to 2.3 per cent this year as the effect of lower oil prices impacts the wider economy, he said. Next year he is expecting a slight recovery, to 2.5 per cent.
Growth in Dubai will fall to 3.3 per cent this year, down from 3.5 per cent last year, before recovering to 3.6 per cent next year.
Abu Dhabi’s GDP growth would experience a “sharp decline,” he added, down from 4.3 per cent last year to 1.5 per cent this year and 1.7 per cent next year.
Economic sentiment in the UAE dipped in September as a slowdown in global growth put pressure on domestic businesses.
Business conditions in September improved at the weakest pace since June, according to the UAE purchasing managers’ index (PMI), a measure of business activity in the non-oil private sector.
The Emirates NBD-sponsored index, which covers manufacturing and services, slipped to 54.1, down from 54.7 in August. A figure above 50 means businesses in the country are expanding, while below 50 signals a contraction.
The figure was also broadly in line with the average so far this year (53.8), albeit noticeably lower than 2014 (58.1) and 2015 (56.0) averages.