IMF issues its final report for 2013 following its discussions with the UAE on Article IV
- Net revenue amounted to AED 488.1 billion in 2013
- Increase in goods and services exports and re-exports to USD 542.1 billion in 2018
- Increase of non-oil exports to USD 193 billion in 2018
In line with its meetings held to discuss Article IV of the its establishment agreement, the International Monetary Fund’s (IMF) issued its final report following discussions with the UAE which took place from April 30 to May 15, 2013. The IMF holds similar meetings with all member states to assess their economic and financial performance.
The report cited the positive indicators of the UAE’s overall economy, highlighting the strength in the growth of the UAE’s economy which guarantees a solid business environment for investors. This is supported by solid legislations which in turn lead to a growth in the tourism sector, stability in the real estate industry as well as rising capital inflows due to an increase in global liquidity.
HE Obaid Humaid Al Tayer, Minister of State for Financial Affairs at MoF, said: “The indicators and statistics stated in the final report of the IMF report highlighted the strength and durability of the UAE’s economy, and the efficiency of economic and financial policies adopted by the country. In fact, this contributed to our ability to face obstacles resulting from the financial and economic crises experienced worldwide.”
HE added: “The final report of the IMF presented a clear and transparent picture of the UAE’s economy. In fact, it reflects the country’s solid underlying foundations and offers investors a clear vision of its growth rates where it guarantees a solid business environment supported by legislations for the establishment and management of their businesses.”
The IMF’s statistics highlight the economic diversification achieved by the UAE, where the non-oil sector achieved a growth rate of 4.3% in 2013, supported by successes in the tourism, real estate, trade and wholesale sectors. This is due to Dubai’s position as an international destination for tourism and real estate investment in the region; where it recently announced plans for establishing large new projects in both the real estate and tourism sectors. In addition, Dubai is nominated to host the World Expo 2020, which requires the implementation of many plans and projects. For its part, Abu Dhabi continues to expand in activities in the energy and hydrocarbon sectors, where it depends on the economy diversification strategy, which focuses particularly on petrochemicals, renewable energy, aviation, and the tourism sectors.
In 2013, the UAE is witnessing economic revival as a direct result of rising oil prices and economic activities backed by investments, trade, tourism and logistical support, where the report predicted that the rate of GDP growth will reach 3.6% in 2013, and will rise to 3.7% in 2014 and 3.8% in 2015.
The report also stated that the non-oil sector will achieve further growth in 2013 that will amount to 4.3%; supported by the recovery in the construction and real estate sectors as well as the continued growth in tourism related sectors. The UAE expanded its production of hydrocarbons at about 5.2%, and the surplus in the current balance rose to 17% of GDP in 2012.
The report indicated a rise in the Central Bank’s reserves which amounted to USD 47 billion for 2012. Forecasts also show that trade balance is expected to rise through achieving a surplus of 15% in 2013. This will be supported by increasing oil prices, non-oil exports, trade and re-exports.
The Fund’s statistics point out the most critical economic indicators for the UAE up to 2018, where the nation’s GDP is expected to increase from USD 377 billion recorded in 2012 to USD 474.2 billion in 2018.
Furthermore, the report forecasted an increase in commodity and services exports and re-exports from USD 347 billion in 2012 to USD 542.1 billion in 2018. Non-oil exports will also increase (without including re-exports of the same) from USD 96.3 billion in 2012 to USD 193 billion in 2018.
With regards to the unified budget covering the years from 2008-2014, studies have shown that the net revenue for 2011 amounted to AED 439.6 billion, which rose to AED 494.4 in 2012, and are expected to rise to AED 488.1 billion in 2013.
The report also showed that revenues resulting from non-oil exports were recorded at AED 77.9 billion in 2011 and AED 98.5 billion in 2012. This figure is expected to rise to AED 105.3 billion in 2013 and AED 114 billion in 2014. The report highlighted a rise in hydrocarbon exports, where they amounted to AED 361.7 billion in 2011 and AED 395.9 billion in 2012. Exports are expected to rise up to AED 382.8 billion in 2013.