International Monetary Fund’s (IMF) World Economic Outlook predicts that the UAE economy will grow 3.3 per cent in 2021, even as it expects a 3.5 per cent decline this year, given the current global economic scenario caused by the Covid-19 outbreak.

Iran will bear the biggest brunt of Covid-19 with a 6.0 per cent decline this year, following 7.6 per cent in 2019. According to the IMF, Saudi Arabia, Qatar, Kuwait, and Oman economies will shrink by 3.9 per cent, 4.3 per cent, 1.1 per cent, and 2.8 per cent respectively.

Predicting that the global economy will see a -3 per cent growth during the “The Great Lockdown”, the IMF added that the economy will bounce back next year with a 5.8 per cent growth, provided the pandemic is over and economic activity returns to normal.

According to the report, “Many countries face a multi-layered crisis comprising a health shock, domestic economic disruptions, plummeting external demand, capital flow reversals, and a collapse in commodity prices. Risks of a worse outcome predominate.”

Most countries in the advanced economies group will see a decline this year, according to the IMF. These include the US, which will see a – 5.9 per cent growth, Japan, which will see a – 5.2 per cent growth the UK’s economy is predicted see a – 6.5 per cent growth, while Germany, France, Italy, and Spain are expected to see a growth of – 7.0 per cent, -7.2 per cent, -9.1 per cent, -8.0 per cent, respectively.

According to the forecast, India and China are the only two countries that will see growth this year, of 1.9 per cent, and 1.2 per cent respectively.

The Middle East and Central Asia region will see a growth of 4.0 per cent in 202, following a decline by 2.8 per cent this year. While the Middle East and North Africa (MENA) will see a decline of 3.3 per cent this year but will see a growth of 4.2 per cent next year.

The advanced economy group forecast for growth has been pegged at 4.5 per cent, while growth for the emerging market and developing economy group is forecast at 6.6 per cent.

With regards to oil prices, the IMF predicts that they will continue to be below $45 a barrel through 2023, 25 per cent lower than the 2019 average price.