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UAE GDP expands 3.8% in Q1 with most sectors achieving growth

Economy grows faster than the full-year forecast by Central Bank, IMF and World Bank

The UAE economy grew 3.8 per cent at constant prices in the first quarter with most of the sectors making significant contributions to the country’s growth, according to data released by the Federal Center for Competitiveness and Statistics.

The preliminary estimates showed that GDP grew by more than Dh15 billion during the January-March period to Dh418.3 billion.

The non-oil GDP totalled Dh312 billion, indicating an increase of more than Dh13.5 billion or a 4.5 per cent growth.

The first-quarter performance is better than the full year’s projections of 3.3 per cent by the UAE Central Bank and 2.8 per cent by World Bank, and 3.5 per cent by the International Monetary Fund.

The UAE aims to grow at seven per cent per annum in the coming years to reach Dh3 trillion GDP by 2030.

The economy is expected to cool down this year after a sizzling growth of 7.9 per cent growth in 2022. In the post-pandemic period of 2021-22, economy bounced back strongly after contracting in 2020.

Abdullah bin Touq Al Marri, Minister of Economy, said the latest economic results reflect the UAE's progress in diversifying and sustaining its economy, moving closer to achieving the economic objectives of the 'We the UAE 2031' vision.

“The flexible economic policies that we adopted to support this goal rely on speed and accuracy in responding to global changes, the formulation of forward-looking strategies and plans to drive economic diversification, and the constant upgrade of economic procedures and legislation. These efforts have helped to maintain the UAE’s position as an attractive environment for investments on an ongoing basis, thus underlining foreign trade and openness to the world as the key aspects of its global partnerships,” he said.

“The national economy continues to grow, supporting the UAE’s vision to transition into a new economic model based on knowledge and innovation. It confirms the country’s reliance on innovative business models based on proactivity, and flexibility in plans, procedures and legislation,” said Hanan Mansoor Ahli, Director of the Federal Center for Competitiveness and Statistics.

The contribution of the transport and storage sector to the GDP in Q1 2023 amounted to Dh21.79 billion, up 10.9 per cent compared to the same period in 2022, to become the highest.

This is followed by the construction sector with a 9.2 per cent growth compared to the same period in 2022, to a total of Dh36.3 billion. The accommodation and food services activities grew by 7.8 per cent, while the finance and insurance sector achieved a 7.7 per cent growth. Wholesale and retail trade achieved 5.4 per cent growth in the first quarter of the year, exceeding Dh102.3 billion.

The non-financial projects sector grew by 3.5 per cent, an increase of more than Dh11.7 billion compared to Q1 2022. The ICT sector also achieved a growth of 3.3 per cent, while the real estate sector recorded a 3.1 per cent growth.

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