You don't have to look too hard, but there are sure signs that the country's economy is at the cusp of something big after what can be described as a few lacklustre quarters. As the International Monetary Fund's Koshy Mathai put it last week, "The [UAE] economy may now be at a turning point, supported by public spending." Both statistical and anecdotal evidence points to the fact that the green shoots of growth are becoming evident across various sectors of the economy.
The latest UAE PMI (Purchasing Managers' Index, an indicator of the economic health of the country's non-oil sectors) is at a 16-month high, the inflation is well under control, and business confidence is at a seven-year high. Monthly data shared as part of the Emirates NBD PMI shows a marked improvement in business activity even as the growth in jobs for April remains marginal. In addition, the global oil price is expected to average above the $70/barrel-mark for the remainder of the year, offering the flexibility to further boost government expenditure for infrastructure development.
With Expo 2020 on the anvil, the construction sector has been witnessing remarkable activity of late, and new residential real estate is keeping pace with infrastructure and commercial construction. Dubai real estate benchmark Emaar Properties just announced an impressive 53 per cent increase in property sales during the first quarter of 2019, and a 7.2 per cent increase in net profits for the same period on the back of more than doubling sales to international investors.
The new, relaxed visa regime has now been implemented, with first long-term visas already issued. The positives from these will, surely, start manifesting themselves sooner than later.
According to the World Travel and Tourism Council, the UAE's travel sector remains on an upswing. The Abu Dhabi share market index is up 7.4 per cent while Dubai's stock market index is up 8.8 per cent this year so far. With the government announcing a slew of major projects in the past few weeks, analysts expect 2019 to be a year of sustainable growth.
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