UAE's GDP To Grow By 3.5% In 2023, 3.9% In 2024

UAE's Gross Domestic Product (GDP) is expected to grow by 3.5 percent in 2023 and 3.9 percent in 2014, as per Chief Investment Officer, Emerging Markets at UBS Global Wealth Management, Michael Bolliger.

Bolliger shared the bank's positive outlook on the UAE's medium-term growth prospects, which is supported by oil exports and energy investments' demand, noting that there could be a strong 4.5 percent expansion for the non-energy part of the economy in 2023.

Furthermore, he explained that the introduction of 9 percent of corporate tax this year will also contribute to bolstering public finances. He also recalled the adoption of a 5 percent value-added tax (VAT) in 2018.

According to the chief investment officer, these measures alongside adding more initiatives to reduce the economy's dependence on the hydrocarbon sector will eventually help the country to diversify the economy further.

"This, in turn, contributes to supporting macroeconomic stability as well as the country's fiscal accounts and its balance of payment, further boosting the country's attractiveness as a destination for foreign direct and portfolio investments," he added, WAM reported.

Bolliger went on to forecast that the UAE's renewables sector will boom in the coming future as the country aims to reach net-zero carbon emissions by 2050 via expanding the share of renewables in its energy mix, investments in sustainable desalination technologies, and emission reduction.

"Relying more on renewable energy domestically and improving the energy efficiency will free up more hydrocarbons for the export market, which will translate into positive effects for the UAE's fiscal balance and its balance of payment," Bolliger added.

He also addressed the upcoming COP28 summit, scheduled to be held from Nov. 30 to Dec. 12 in Expo City Dubai, and said that such an event offers a great opportunity for the country to highlight its own net-zero strategy.

The officer continued, "The UAE is among the most competitive regions globally in producing renewable energy, with the country hosting several of the world's largest and most cost-efficient solar power plants."

Bolliger pointed out that in recent years, the UAE has launched a number of landmark solar power projects including the Al Dhafra Solar PV plant and Mohammed bin Rashid Al Maktoum Solar Park, which will help to harness the country's solar power capacity and support its energy transition journey.

UAE's Minister of Climate Change and Environment, Mariam bint Mohammed Saeed Hareb Almheiri had said that the country is ready to host the highly anticipated COP28 summit, adding that it is a "living testament to our achievements and a hopeful glimpse into the future."