UAE reports sluggish economic growth rates for 2019

The UAE economy grew at a rate slower than expected - at around 1.7 percent in 2018 - despite higher oil prices, Reuters reported on Monday.

Growth was 0.8 percent in 2017 but had been predicted to increase to 2.9 percent last year, according to Bloomberg. 

Dubai last week said its economy grew by 1.94 percent last year, having not published figures in recent years leading to speculation over the health of the economy.

The 2019 figure is the slowest growth rate since a 2009 contraction in the Dubai economy caused by large amounts of debt.

The UAE had in its December projection expected growth between 2.5 and 3 percent for 2018. It and other OPEC members are benefiting from higher oil prices after the cartel decided to cut oil output to reduce a glut that was weighing on prices.

Higher oil prices and good performance by other sectors drove economic growth, Economy Minister Sultan bin Saeed al-Manouri said on Saturday, according to state news agency WAM, with the non-oil sector growing by around 1.3 percent.

The oil and gas sector was the single largest contributor (30 percent) to economic growth, Reuters stated, quoting the Federal Competitiveness and Statistics Authority.  

To maintain economic growth, Dubai has cut costs for key industries including real estate and education.

Abu Dhabi announced a $13.6 billion economic stimulus package in June to boost the economy.

The UAE has projected a growth of 3.5 percent for 2019, while IMF said in February it expects a growth of 3.7 percent.