Economic sentiment in the UAE is improving amid a rise in oil prices and a pick up in activity in non-oil sectors since the end of last year.
According to the majority of respondents to a survey commissioned by The National, the outlook for economic growth in the UAE has strengthened since the final quarter of last year.
About 45 per cent of respondents to the question strongly agreed while 47 per cent of those asked agreed, according to the survey undertaken by Borderless Access. Only 8 per cent of those polled disagreed with the notion, the survey results showed.
“The poll result shows the active focus of the UAE population on the recent macro and micro economic events in the region,” said Dushyant Gupta, the senior vice president at Borderless Access. “The overall trend shows the positive mindset and also the expectation for the economic turnaround and return of high growth rates.”
Borderless Access interviewed hundreds of professionals in the UAE for the survey.
The results match an increasing number of indicators, from corporate earnings to purchasing manager surveys (PMI) and forecasts from the IMF, that the country’s economy is on the mend following several dismal years after the oil price crash that began in the summer of 2014.
The IMF said in October that the UAE projected a 2.3 per cent growth for last year and 2.5 per cent this year. Before 2015, the economy had been growing at more than 4 per cent for several years amid high oil prices.
National Bank of Abu Dhabi, the biggest lender by assets in the UAE, said last month that it expects the UAE to lead economic growth in the Arabian Gulf this year amid higher spending that will be spurred on by recovering oil prices.
Since Opec and non-Opec countries agreed to curb output in December, Brent crude prices have risen by 10 per cent to about $US55 a barrel.
While the region is heavily dependent on oil sales, the UAE has been among the countries in the region that has done a better job of diversifying its economy and coming up with new streams of revenue, according to NBAD’s annual global investment outlook.
Backing up these assertions is the harder PMI data. The UAE’s non-oil business activity rose to a six-month high in January, thanks to a rise in new orders, higher output and improved demand from overseas, according to the latest sentiment survey from Emirates NBD.
The Emirates NBD/IHS Markit PMI, which measures the economic confidence of business managers in the manufacturing and services industries, increased to 55.3 last month, up from 55.0 in December. A figure above 50 means businesses in the country are expanding, while a reading below 50 signals a contraction.
Many economists say that despite several encouraging signs oil prices still remain low compared to their historic performance and that a strong US dollar, to which the dirham is pegged, will weigh on the competitiveness of the UAE.
“Encouragingly, we’ve seen the PMIs find a floor, rising for the fourth consecutive month in January,” said Razan Nasser, a senior economist at HSBC in Dubai. “The Department of Tourism and Commerce Marketing also reported a 5 per cent increase in overnight visitors [to Dubai] in 2016.
“All of this is in line with our view that the UAE is set to be the Gulf’s strongest economic performer in 2017. However, we expect this growth to be muted in contrast to historic performance. Oil prices remain too low to trigger a recovery even with their recent rebound and the USD-driven gain in the real effective exchange rate should continue to weigh on competitiveness through 2017.”
mkassem@thenational.ae
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THREE POSSIBLE REPLACEMENTS
Khalfan Mubarak
The Al Jazira playmaker has for some time been tipped for stardom within UAE football, with Quique Sanchez Flores, his former manager at Al Ahli, once labelling him a “genius”. He was only 17. Now 23, Mubarak has developed into a crafty supplier of chances, evidenced by his seven assists in six league matches this season. Still to display his class at international level, though.
Rayan Yaslam
The Al Ain attacking midfielder has become a regular starter for his club in the past 15 months. Yaslam, 23, is a tidy and intelligent player, technically proficient with an eye for opening up defences. Developed while alongside Abdulrahman in the Al Ain first-team and has progressed well since manager Zoran Mamic’s arrival. However, made his UAE debut only last December.
Ismail Matar
The Al Wahda forward is revered by teammates and a key contributor to the squad. At 35, his best days are behind him, but Matar is incredibly experienced and an example to his colleagues. His ability to cope with tournament football is a concern, though, despite Matar beginning the season well. Not a like-for-like replacement, although the system could be adjusted to suit.
Tour de France 2017: Stage 5
Vittel - La Planche de Belles Filles, 160.5km
It is a shorter stage, but one that will lead to a brutal uphill finish. This is the third visit in six editions since it was introduced to the race in 2012. Reigning champion Chris Froome won that race.
The flights: South African Airways flies from Dubai International Airport with a stop in Johannesburg, with prices starting from around Dh4,000 return. Emirates can get you there with a stop in Lusaka from around Dh4,600 return.
The details: Visas are available for 247 Zambian kwacha or US$20 (Dh73) per person on arrival at Livingstone Airport. Single entry into Victoria Falls for international visitors costs 371 kwacha or $30 (Dh110). Microlight flights are available through Batoka Sky, with 15-minute flights costing 2,265 kwacha (Dh680).
Accommodation: The Royal Livingstone Victoria Falls Hotel by Anantara is an ideal place to stay, within walking distance of the falls and right on the Zambezi River. Rooms here start from 6,635 kwacha (Dh2,398) per night, including breakfast, taxes and Wi-Fi. Water arrivals cost from 587 kwacha (Dh212) per person.
RESULTS FOR STAGE 4
Stage 4 Dubai to Hatta, 197 km, Road race.
Overall leader Primoz Roglic SLO (Team Jumbo - Visma)
Stage winners: 1. Caleb Ewan AUS (Lotto - Soudal) 2. Matteo Moschetti ITA (Trek - Segafredo) 3. Primoz Roglic SLO (Team Jumbo - Visma)
'Young girls thinking of big ideas'
Words come easy for aspiring writer Afra Al Muhairb. The business side of books, on the other hand, is entirely foreign to the 16-year-old Emirati. So, she followed her father’s advice and enroled in the Abu Dhabi Education Council’s summer entrepreneurship course at Abu Dhabi University hoping to pick up a few new skills.
“Most of us have this dream of opening a business,” said Afra, referring to her peers are “young girls thinking of big ideas.”
In the three-week class, pupils are challenged to come up with a business and develop an operational and marketing plan to support their idea. But, the learning goes far beyond sales and branding, said teacher Sonia Elhaj.
“It’s not only about starting up a business, it’s all the meta skills that goes with it -- building self confidence, communication,” said Ms Elhaj. “It’s a way to coach them and to harness ideas and to allow them to be creative. They are really hungry to do this and be heard. They are so happy to be actually doing something, to be engaged in creating something new, not only sitting and listening and getting new information and new knowledge. Now they are applying that knowledge.”
Afra’s team decided to focus their business idea on a restaurant modelled after the Leaning Tower of Pisa. Each level would have a different international cuisine and all the meat would be halal. The pupils thought of this after discussing a common problem they face when travelling abroad.
“Sometimes we find the struggle of finding halal food, so we just eat fish and cheese, so it’s hard for us to spend 20 days with fish and cheese,” said Afra. “So we made this tower so every person who comes – from Africa, from America – they will find the right food to eat.”
rpennington@thenational.ae
