HomeUAEMoody’s: UAE GDP growth to reach 6 - 7%

Moody’s: UAE GDP growth to reach 6 – 7%


ABU DHABI, 13 September – Moody’s Investors Service forecasts UAE real GDP growth of 6%-7% in 2022, supporting the credit quality of rated UAE real estate companies.

“We forecast UAE real GDP growth of 6%-7% in 2022 and the credit quality of UAE real estate companies we rate to remain broadly stable in the next 12-18 months,” said Lahlou Meksaoui, VP-Senior Analyst at Moody’s.

“However, more dangerous waves of COVID-19, higher inflation, rising interest rates, and fears of recession in US and Europe pose risks to the economic recovery.”

The credit quality of UAE’s real estate companies is likely to be supported by a strong economic recovery, led by increased oil production, higher energy prices and a rebounding services sector, though threats to this scenario are rising, the ratings agency said in a report.

Despite these risks, the country’s management of the pandemic and introduction of new residency visas have already led to a rebound in the labour market, a key housing demand driver. Dubai’s population has grown over the last few years and this is credit positive because population growth will contribute to balance residential market supply and demand.

Economic growth attracts foreign investment and boosts economic confidence. As an example, in February 2022, Apollo Global Management, one of the world’s largest alternative investment managers, signed a commitment with Aldar Properties to invest $1.4 billion to drive Aldar’s growth, it said.

The UAE’s economy grew by an estimated 8.2% in Q1 2022, buoyed by higher oil production, the central bank reported. Real GDP is expected to grow 5.4% this year and 4.2% next year, the central bank said. — Zawya


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