The UAE's economy is expected to grow about three per cent in 2018 despite challenges in the global economy as diversification helped minimise the impact of volatile oil prices, the economy minister said.
The latest guidance from the UAE's minister of economy Sultan Al Mansoori is in line with a forecast by the International Monetary Fund which expected the economy to expand by 2.9 per cent in 2018, according to its latest data.
"Growth should be hovering around three per cent, it is positive considering we see a lot of challenges in the global economy with all the protectionism," Mr Al Mansoori said on Monday during a speech at the Global Investment Aviation Summit in Dubai.
The IMF forecasts the UAE economy will expand by 3.7 per cent this year on the back of an expected rise in government spending ahead of Expo 2020 in Dubai. The UAE has boosted efforts to diversify its economy and the government introduced a slew of measures aimed at propelling the non-oil sector, which accounts for just over 70 per cent of the country’s GDP.
"The fluctuation in prices of oil did have an effect but to a certain extent and, because the UAE has a diversified economy and oil now contributes roughly about 30 per cent of GDP, the effect of that was minimum," Mr Al Mansoori said. "But that doesn't mean it did not have some effect but we managed to build the diversity of a number of sectors."
The aviation sector is a key pillar in the UAE's economic diversification plans, where Dubai International Airport has maintained its title as the world's busiest hub by international passenger traffic for five consecutive years after grabbing that crown from London Heathrow in 2014.
