A disappointing year for growth in the UAE

09 November, 2017 | By ELIZABETH BAINS

The UAE is seeing muted growth in 2017, estimated at less than 1.5 per cent, as low oil prices and production cuts weigh on the economy.

The non-hydrocarbons sector is faring much better, with GDP growth of more than 3 per cent, but it is largely Dubai’s preparations for hosting Expo 2020 that have been driving the market.

Capital spending in Abu Dhabi (outside the hydrocarbons sector, which is having a strong year for contract awards) remains constrained, with the focus instead on completing megaprojects such as the new airport terminal, the $1.6bn strategic tunnel enhancement wastewater project and the Louvre museum, which is due to open in November.

To boost income, the federal government is introducing new taxes, beginning with excise duties on tobacco and carbonated drinks this month and VAT to follow at the start of next year. While this makes good sense economically, for the ordinary person it is another leap in the cost of living in the UAE.

With about 80 per cent the population comprising expatriates, it is essential the country remains an attractive lure for foreign workers. The rising costs coupled with stagnant wages risk tipping the balance. In this regard, it is fortunate that property prices are weakening. What would usually be seen as a negative economic barometer, falling rents and sales prices on this occasion will be welcomed by the authorities as helping to soften the blow of the new taxes being introduced.

Dubai tops global cities for construction

Dubai tops list of 50 cities with total project values amounting to $374.2bn A total of 6,645 planned and ongoing construction projects by the world’s megacities, valued at $4.2tn and fuelled ...

Leading the transition to renewable energy

Acwa Power’s Paddy Padmanathan explains how the firm is driving the development of alternative energy Another milestone in the global transition towards renewable energy was reached on 9 October with the ...

Adnoc considers changes to In-Country Value scheme

Adnoc is considering adjustments to its In-Country Value (ICV) system, which was introduced in January this year. An Adnoc spokesperson told MEED: “As with any programme of this nature, you listen and learn during ...

Further cuts to Mena construction outlook

GlobalData downgrades growth forecast as regional lockdown measures are extended until the end of May GlobalData has cut its construction output growth forecast for the Middle East and North Africa (Mena) region ...

Contractors submit bids for Dubai Expo pavilion

Local developer Emaar Properties has received bids from contractors for the deal to build the Mobility pavilion at the Dubai Expo site. Emaar is also tendering the contract to build the ...

MARKET TALK: Sector focus helps Mashreq service clients better

Understanding specific industries means the Dubai-based bank can understand and address the issues the construction industry faces MEED: How have Mashreqs operations evolved to meet the needs of the changing market? Mohammad ...

UAE construction consolidates with Year of Zayed

The emirates are working together on major new projects in 2018 The UAE is marking 2018 as the Year of Zayed to commemorate the birth of the federation’s founding president, Sheikh ...

Surviving the Covid-19 economic crisis

The impact of the health crisis on the region’s economies continues to play out On 22 March, Dubai-based Emirates airlines announced the shocking news that it was suspending all passenger services for ...

Resurgent Abu Dhabi creates new challenges for construction

The economic stimulus package approved in June has been followed by a flurry of tendering activity Abu Dhabi’s construction sector was given a boost in early June when Crown Prince Sheikh ...

UAE leads as global economy restarts

Dubai and Abu Dhabi are taking leading roles as countries start to emerge from lockdowns The second half of 2020 will be crucial for the global economy as countries begin to ...