The country’s real gross domestic product (GDP) is expected to grow 3.7 per cent this year, higher than the 2.9 per cent forecast for 2018 and the 0.8 per cent growth achieved in 2017, according to the latest economic outlook figures from the International Monetary Fund (IMF).

Economists concur that global and regional factors are unlikely to moderate the economic growth of the UAE and the wider GCC — a trend in line with IMF projections of strong growth revival in Abu Dhabi and Dubai in 2018 and 2019.

Analysts had forecast an overall GDP growth of 2.5 to 3 per cent in 2018.

Abu Dhabi’s GDP, which saw a negative growth rate of minus 0.5 per cent in 2017, is expected to grow by 3.4 per cent this year, an improvement on the 2.7 per cent forecast for 2018.

Dubai, which grew at 2.8 per cent in 2017, is expected to deliver growth of 4 per cent this year, more than the 3.3 per cent growth forecast for 2018.

The latest IMF projections, however, were based on two main factors — the significant increase in oil prices and progress in the country’s fiscal adjustment programme — both on the revenue and expenditure sides.

However, given the changing dynamics of the global oil market — a function of not only supply and demand, but also geopolitical factors — economists see GDP growth in the range of 2.5 to 2.8 per cent this year, slightly higher than in 2018.

Many economists reduced their growth forecasts for the UAE in the wake of falling oil prices and a decline in crude output, the consequence of the decision by the Organisation of Petroleum Exporting Countries (Opec) to lower output by 800,000 barrels a day from what the group pumped last October.

Economists view the UAE as more diversified than other major GCC oil exporters, in addition to it having a well-managed economy and a business environment among the top 16 economies in the world, supported by excellent infrastructure and political stability.

“The resilience of the UAE banking system to lower oil prices has improved in recent years, thanks to the improvement in the supervision and regulation by the Central Bank of the UAE,” Iradian said.