Recently, CBUAE (Central Bank of the UAE) stated on Thursday that: The UAE will undergo a whole recovery time frame during 2022, while revolving to a positive progress this year, post recording a huge slump down in the preceding year 2020.
The Apex Bank stated that: “The pathway to full recovery will be determined by a sustained surge in fiscal spending, healthy banking sector credit progress, robust enhancement in employment and healthier business sentiment, with part of Expo 2020 Dubai taking place in 2022 as well.”
Respectively, during 2021 as well as 2022, the overall foresees real estate GDP to restart the progression by 2.5 to 3.5 percent, and as well as the non-hydrocarbon GDP to upsurge by 3.6 to 3.9 percent.
The Quarterly Economic Review stated that: “However, economic estimates include extraordinary uncertainty amidst Covid-19 consequences and are thus subject to revisions.
Economic motion in the UAE sustained its recovery in the fourth quarter of 2020. Non-oil sectors enhanced further in the three-month period as lockdowns were improved and travel continued, while the nation commencing the initial phases of vaccine distribution. The central bank estimations real total GDP progress for the year 2020 to be – 5.8 percent, with the real non-hydrocarbon GDP anticipated to deteriorate by 5.7 percent.
Consumer price inflation endured negative for the fourth quarter at -2.2 per cent year-on-year, determined by negative inflation in non-tradeable (-3.5 per cent) as an outcome of a deterioration in rents and in the rates of fuel, in tandem with overall submissive domestic demand.
With regard to the united fiscal stance in the third quarter of 2020, the most current period for which data is accessible, the functioning fiscal balance recorded a shortfall of Dh4.6 billion, due to the fall in revenues by 38 percent year-on-year to Dh67.8 billion, while disbursements deteriorated by 21.7 percent to Dh72.4 billion.
It further added that: “Both deposits and gross credit rose on a yearly basis despite the economic contraction, while decreasing on a quarterly basis.”
The Central Bank also stated that: “Meanwhile, financial soundness pointers endured to remain healthy, reinforced by the boosted Targeted Economic Support Scheme, which was prolonged in November to extend loan repayment deferrals and other regulatory relief measures until June 2021.”
It further added that: “Both deposits and gross credit upsurged on a yearly basis notwithstanding the economic narrowing, while diminishing on a quarterly basis.”
As an oil exporter, the UAE is possibly to feel the effect from concentrated global mandate for oil due to the shrinkage in economic activities globally, including transportation and global travel, the central bank stated further.
In line with the agreement by Opec+, UAE’s oil production declined off by 17.7 percent year-on-year in the third quarter and by 18.2 percent in the fourth. Real oil GDP is predictable to have slumped down in 2020, conforming to average oil production of 2.78 million bpd for the year as a complete statistic, it added.