UAE economic growth to exceed 4% this year, Minister of Economy says

The country will focus on attracting investments from Russia, Australia, China and the UK

Abdulla Bin Touq Al Marri, Minister of Economy. Photo: UAE Government Media Office

The UAE’s economy is expected to grow by more than 4 per cent this year as the country continues to roll out initiatives to help it recover from the coronavirus pandemic-induced slowdown, Minister of Economy Abdulla bin Touq said.

The latest forecast is higher than the Central Bank’s assessment in December, which put expectations for growth at 2.5 per cent in 2021.

As part of the plans to boost growth, the UAE will be seeking Dh550 billion ($150bn) of inward foreign investment over the next nine years and it aims to be among the 10 biggest global investment destinations by 2030, Mr bin Touq said in an interview with Bloomberg television on Sunday.

The Arab world’s second-largest economy will attract investments from countries including Russia, Australia, China and the UK, the Minister said. It also plans to strengthen its economic partnerships with South Korea, Indonesia, Kenya, Ethiopia, India, Israel and Turkey, officials said.

The UAE introduced initiatives in the past year to help the economy recover from the coronavirus pandemic, including a Dh388bn support package, as well as a Dh50bn Targeted Economic Support Scheme (Tess), to boost liquidity in the financial and banking sector.

The Tess programme, which offered zero-cost collateral funding to banks to encourage lending to the broader economy, has been extended to the end of June 2022.

The UAE also unveiled two visa categories, a Green visa and a freelancer visa, to attract and retain skilled workers as part of the measures announced on Sunday.

The government will also allow people who have lost their jobs to remain in the country for up to 180 days.

“The fuel for any economy is the human capital,” Mr bin Touq said, while adding that the authorities understood that someone losing their job should not have to leave immediately.

The UAE is also increasing the contribution of industrial sector to its economy. Under the Operation 300bn initiative launched out in March, the country plans to double the industrial sector’s contribution to national gross domestic product to Dh300bn by 2031 from Dh133bn.