The growth of the non-oil sector significantly outpaced total growth in the primary half of the year, according to the economy minister of the United Arab Emirates, whose GDP increased by 3.7%.
Speaking at an economic conference in Dubai, Abdulla bin Touq Al Mari stated that non-oil growth increased by 5.9% in the first half of the year.
He stated that the UAE’s economic success was evidence of its adaptability, diversification, openness, and dedication to international cooperation. He also mentioned that the nation was growing less dependent on oil and more on knowledge-based sectors.
Over 70% of the nation’s GDP is generated by the non-oil industry.
Considering how much of their income comes from hydrocarbons, the Gulf states are all planning to diversify their economies.
The United Arab Emirates (UAE) is a leader in this process, having established industries including financial services, trade, and tourism in addition to enacting corporate and social reforms.
The UAE’s economy expanded 7.9% in real terms last year, helped by both a surge in oil prices and a quick recovery in commerce and tourism following the COVID-19 outbreak, particularly in Dubai, the center of the region’s business and tourism.
However, growth is anticipated to abruptly slow down throughout the area in 2023 due to reduced oil prices, OPEC+ member countries’ oil output restrictions, and adverse global economic conditions.
The UAE is expected to beat the larger GCC region this year, with an overall GDP growth of 3.5% predicted by the IMF, with non-hydrocarbon growth expected to surpass 4%.
However, the picture “remains vulnerable to heightened global uncertainty,” according to a report it released.
“A decrease in demand for oil and decreased global trade and visitor arrivals from weaker worldwide expansion, higher-for-longer interest rates, reduced liquidity, or developments in geopolitics would weigh on growth and put stress on fiscal and foreign balances,” the report, which was released on Oct. 16, stated.