The Arab Monetary Fund expected the Gulf Cooperation Council countries to achieve relatively high growth rates of about 6.3% in 2022, compared to 3.1% in 2021.
The fund attributed its expectations to “the sum of the factors supporting growth in both the oil and non-oil sectors and the positive impact of the ongoing economic reforms, in addition to the continued adoption of stimulus packages to support the post-Covid-19 recovery. pandemic.”
The Arab Monetary Fund said in a report titled “Arab Economic Prospects” that it expects the UAE economy to grow “by 5.8% in 2022 and 3.8% in 2023 thanks to an early response to the pandemic and a national vaccination campaign.” , which contributed to the acceleration of economic recovery, especially through the continuation of support policies at the macroeconomic level, especially for the affected sectors, small and medium enterprises, as well as the recovery of economic activity, which directly or indirectly benefited from Dubai Expo.
The Fund’s report also expects “affected sectors to recover to pre-pandemic levels, supported by 100% reopening of operations and an influx of foreign investment seeking a safe environment in light of current geopolitical conditions, in addition to the positive impact. high oil prices and increased public capital spending; and continued policies and reforms to boost non-oil GDP growth, support private sector growth, boost productivity, and attract foreign investment.
The report notes that “rising oil prices boosted government revenues in the UAE, which increased the strength of financial insulators in 2021, which positively reflected on overall economic activity,” noting also that the country, according to the annual report released by the Central Bank of the Emirates, recorded “The highest real GDP growth rate among the Gulf Cooperation Council countries was about 3.8%, and growth is expected to reach 5.8% in 2022.
The Arab Monetary Fund cited “the favorable monetary position, monetary and fiscal stimulus initiatives, the recovery of the global economy, and improved real estate market dynamics in Abu Dhabi and Dubai as the main factors behind the rapid growth of economic activity in the UAE last year. , in addition to increasing the cost of UAE trade.”
Launched by the Emirates Development Bank, the Sanad Initiative aims to accelerate the growth of AED100 million worth of Emirati SMEs, the report states, facilitating and accelerating the process of accessing flexible loans for companies looking to accelerate the growth of their business after the pandemic.
In this regard, the Arab Monetary Fund expected that “the growth rate of the Arab economies as a whole will increase by about 5.4% in 2022 compared to 3.5% in 2021, due to many factors, the main one being the relative improvement in the level global demand and high growth rates. The oil and gas sector and Arab governments continue to adopt stimulus packages to support economic recovery, which have cost more than $400 billion in the period 2020-2022.”
The report points to the positive impact of the implementation of many economic reform programs in the Arab countries, as well as future concepts and strategies aimed at increasing the level of economic diversification, reforming the business environment, encouraging the role of the private sector, supporting human capital and increasing the level of economic resilience in the face of shocks.
Arab oil-exporting countries will benefit in 2022 from the increase in oil production under the OPEC+ agreement and the continued rise in oil and gas prices in international markets, which will support the levels of government spending that stimulate growth in these countries, the report says. , bringing the group’s expected growth rate to 6% in 2022, compared to 3.2% for the group’s growth achieved in 2021.
At the level of Arab oil-importing countries, the report expects “moderate growth will be recorded in 2022, estimated at 4.1%, compared to 2.7% in 2021, with a relative improvement in the country group’s economic growth rate in 2023 to reach 4.6% as a result of an increase in the level of aggregate demand”. In these countries, pressures on government budgets and the balance of payments are gradually easing as a result of the expected decline in commodity prices next year.