UAE economy to grow 2.5% in 2017, says IMF

The International Monetary Fund (IMF) on Tuesday said it expects the United Arab Emirates (UAE) economy to grow at 2.3 percent this year, before rising to 2.5 percent in 2017.

The fund, in its latest World Economic Outlook, noted that the recent modest recovery in oil prices is likely to have little impact on growth in oil-exporting countries as the governments continue to tighten fiscal policy in response to lower oil revenues.

“Growth rates in most other countries of the Gulf Cooperation Council (GCC) are similarly projected to be held back by ongoing fiscal adjustment,” the report noted.

Qatar’s real GDP is projected to grow at 2.6 percent in 2016, rising to 3.4 percent in 2017. Kuwait’s growth is estimated at 2.5 percent this year and 2.6 percent in 2017.

“Continued reform, progress, less fiscal drag, and gradual improvements in external demand are expected to support the recovery.”

The fund maintained its global growth estimate at 3.1 percent for 2016 and 3.4 percent for 2017, while holding its forecast for weak global growth.

“This forecast incorporates somewhat weaker-than-expected activity through the second quarter of 2016 in advanced economies, as well as the implications of the UK referendum outcome in favor of leaving the European Union.”

The recovery in 2017 and beyond is driven primarily by emerging markets and developing economies, it added.