UAE's growth set for strong rebound: IMF

Dubai - The Washington-based fund projected a 1.3 per cent growth in the UAE's real GDP in 2017

 Better days are ahead for the UAE with the economy right on track for a rebound with a 3.4 per cent surge in 2018, the International Monetary Fund said on Tuesday as it urged the Gulf region to speed up reforms and diversification to adjust to low oil income.

The Washington-based fund projected a 1.3 per cent growth in the UAE's real GDP in 2017, while the overall GCC growth is expected to bottom out at 0.5 per cent this year, the lowest since the 0.3 per cent growth recorded in 2009 in the wake of the global financial crisis.

While consumer price inflation in the UAE will edge up slightly from 2.1 per cent in 2017 to 2.9 per cent in 2018, the nation will record current account balance at 2.1 per cent this year and next, the IMF said.

The IMF projected the overall GCC growth to rebound to 2.2 per cent in 2018, but said in order to tackle the unemployment challenges facing the Gulf, the region has to accelerate reform and push ahead with fiscal consolidation.

"Preparing their economies to the post-oil era is something that is becoming a priority for authorities all over the GCC and it is the right time for them to accelerate their diversification outside oil and to promote a greater role for the private sector to lead growth and create additional jobs," said Jihad Azour, director of the Middle East and Central Asia at the IMF.

"Oil exporters should continue pursuing deficit-reduction plans to maintain fiscal sustainability, and where relevant, to support exchange rate pegs," the IMF said.

• Abu Dhabi
• Dubai