The UAE's response to the economic challenges caused by the Covid-19 pandemic will come in two phases, including longer-term stimulus that will "encourage investment in sectors with high potential", such as the digital economy, the renewables industry and companies promoting food security, Minister of Economy Sultan bin Saeed Al Mansoori said.
The short-term response already underway and the gradual reopening of the economy includes Dh282.5bn worth of stimulus measures already announced for the sectors most affected by crisis, linking funds to those most in need, including SMEs, Mr Al Mansoori said.
Looking at the long term stimulus, the government will encourage national industries, secure the provision of necessities and align policies with global trends, Mr Al Mansoori said. New supply chains and business patterns are likely to emerge in the post-Covid-19 era, he said, with a more active role for governments in the national economy and more substantial investments being made in digital infrastructure.
Within the digital economy, the UAE will encourage investment in sectors "with high potential" in areas such as artificial intelligence, 5G, the internet of things and blockchain. Other areas of interest include renewable energy, electric cars, 3D printing, robotics, biotechnology and genetic engineering.
"We call on the private sector to prepare for the digital economy phase that will drive the recovery, nurture future employment skills, shift towards integrating technology at every stage of production to ensure business continuity and growth in the future," Mr Al Mansoori said during a UAE government meeting held to discuss the UAE's response to the pandemic.
He said that some sectors such as tourism, aviation, petreochemicals, retail and real estate had been hit hard by the crisis but others such as technology, internet services, e-commerce and food businesses had grown.
Measures put in place to stop the spread of the Covid-19 pandemic have hurt the global economy, tipping it into a recession that is expected to be the most severe since the Great Depression of the 1930s, with output shrinking 3 per cent this year, according to the International Monetary Fund. The Washington-based lender forecast the UAE's economy will contract by 3.5 per cent this year, but rebound in 2021.
Mr Al Mansoori said the UAE economy is competitive, resilient and linked to various global markets, hence not immune to the global repercussions of the Covid-19 pandemic, but added that it has strong fundamentals that enhance its ability to overcome crises.
