Wednesday, June 19, 2024

Emirates News Agency – Standard & Poor’s to WAM: UAE economy expected to grow 3% in 2023 and 4% in 2024

Date:

From/ Rami Sami..

ABU DHABI, September 26 / WAM / Standard & Poor’s Credit Ratings Agency (S&P) expects the UAE economy to grow by 3% in 2023, with the pace of growth rising to around 4% in 2024, with the main support of the non-profit sector being oil.

Analysts at Standard & Poor’s reported to the Emirates news agency WAM that the UAE government has implemented a broad set of economic and social initiatives over the past few years that will lead to long-term growth.

S&P analysts expect the emirate’s tourism sector to continue to grow by supporting the country’s hosting of major events, which will help it achieve its target of increasing visitor numbers to 40 million by 2030, and the number of hotel rooms to reach 250,000. Same period.

Analysts expect the UAE banking sector to continue to show strong fundamentals, see continued improvement in profitability and surpass pre-pandemic “Covid-19” levels supported by rising interest rates, while the real estate sector in Dubai will show greater resilience. Stable house prices in light of demand is a strong one amid expectations.

S&P’s sovereign ratings analyst Trevor Cullinan said the UAE economy is expected to grow by around 3% this year, and we expect expansion in the non-oil sector to be strong, with broad-based growth in the services and industrial sectors.

The economy of the UAE is expected to grow by around 4% next year, he said, due to the continued growth of the oil sector and non-oil sector, with many sectors contributing significantly to the growth of the country’s economy. , particularly in oil and gas, wholesale, industrial and real estate. , construction, financial services and real estate.

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In line with the “We Emirates 2031” vision, he expected the economic momentum of the non-oil economy to be supported by the influx of expatriates and tourists, positive sentiments of investors and consumers, in addition to the private sector. Aimed at increasing the volume of trade and increasing the share of tourism in the GDP, through collaboration… among all government agencies and institutions and the private sector to advance the development process.

Trevor Cullinan, The UAE government has taken a broad set of business and social initiatives over the past few years, which will lead to long-term growth as initiatives for residential and business are expected to attract skilled workers. Social initiatives can help improve the country’s position in the Middle East.

He said the UAE’s initiatives included allowing 100% direct foreign ownership of more than 1,000 commercial and industrial activities, along with a “bankruptcy” law that eased and provided individuals with financial problems by restructuring their debts. State in the field of ease of doing business, opportunity to re-borrow on easy terms to improve competitiveness.

He explained that the UAE’s initiatives include new visas, expanding the criteria for obtaining a golden residence visa for a period of 10 years, launching a green residence visa for five years, and allowing investors and businessmen to apply for work visas. A sponsor or host is required, and the initiation of a multiple-entry tourist visa for a limited period of five years, in addition to tourist visas for family groups.

Cullinan said the UAE’s recent efforts to improve the UAE dirham-denominated yield curve through the introduction of treasury bonds and instruments denominated in the local currency will lead to the development of local capital markets and expand funding sources for UAE companies and banks. , noted that the implementation of the UAE corporate tax system will contribute to the diversification of government revenue. Apart from the oil sector, the implementation of this tax is another step towards modernizing the business environment in the UAE and aligning it with international standards.

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For her part, S&P’s corporate rating analyst Tatiana Leskova expected the expansion of the tourism sector to support greater economic growth in the UAE, with Dubai Emirate succeeding in attracting 14.7 million international visitors by 2022, a doubling. What was achieved in 2022? In 2021, the number of visitors indicated this year could reach a peak of 16.7 million visitors in 2019 in 2023, while the Emirate of Abu Dhabi attracted 4.1 million hotel guests in 2022, an increase of 24%. From 2021 onwards.

The tourism industry in the UAE is expected to continue to grow, supported by key events such as the United Arab Emirates Conference of the Parties to Climate Change (COP28). The goal is to increase the number of visitors to 40 million by 2030, with the number of hotel rooms expected to reach 250,000 in the same period.

He pointed out that the emirates of Abu Dhabi and Dubai will lead the way in attracting business and tourism to the country, while other emirates such as Ras Al Khaimah and Sharjah are working to develop tourism sectors, which will increase diversity. Tourism offers in the country, especially the Emirate of Sharjah is Arab and Islamic culture and a family destination, it is safe, the Emirate of Ras Al Khaimah for its beautiful nature, recreational activities and authentic programs.

Tatiana Leskova expects the real estate sector in Dubai to show more flexibility with the expectation that house prices will stabilize in light of strong demand, noting that Dubai’s attraction for companies is evident in the increasing number of new business licenses.

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For his part, Dr. Said: Financial Institutions Ratings Analyst and Global Head of Islamic Finance at S&P, Muhammad Damak, said the banking sector in the UAE continues to show strong fundamentals, and profitability is expected to continue to improve and exceed pre-Covid-19 pandemic levels. Banks’ interests also benefit from technological advances.

He expects the capitalization of the UAE banking system to maintain its strength and benefit from improved internal capital formation, with UAE banks continuing to enjoy good financial and liquidity conditions and a good net external asset position, which protects them from downside pressures. An increase in the cost of global liquidity.

Nadia Barnett
Nadia Barnett
"Award-winning beer geek. Extreme coffeeaholic. Introvert. Avid travel specialist. Hipster-friendly communicator."

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