UAE - The worst seems to be behind us. After a fairly subdued 2017, the UAE economy is bouncing back and expected to perform better in the coming years.
 
Growth last year had slipped to a seven-year low but this year the economy is expected to expand by 2.6 per cent. What's interesting here are the factors propelling the economic engines.
 
Rising price of oil, of course, is significantly adding to the momentum but a lot of credit for the rebound also goes to the measures announced by the government in the recent months. Financial stimulus announced by Abu Dhabi and Dubai, and increased spending on infrastructure in Dubai will give a much needed fillip to the overall economy.
 
A buoyant trade and tourism sector, crucial policy decisions such as lowering of commercial fees, special visa rules, changes to the arbitration law, and flexibility in business licences, are also going to positively impact growth in coming months.

The optimism is rising across the board. The non-oil sector is seeing faster growth. There's a stronger inflow of new businesses and faster output growth. The number of bounced cheques, too, is falling, which points at a more productive work environment. The UAE is arguably a font of wealth and talent in the region.

As per the Boston Consulting Group, Dubai is the sixth best expat city in the world, and Abu Dhabi is the 14th best. These two cities are often cited as the only ones from the region among the top global cities in attracting talent and investment. So it is crucial that the UAE maintains its attractiveness, and private sector has a vital role to play in this.

Despite the surge in business activity and new work, employment remains anemic in the private sector. Businesses are getting new orders but the pace of work and delivery is suffering due to the lack of workforce.

Private businesses are still cautious about spending, and austerity measures continue to be in place. This is not sustainable in the long run. Increments should be doled out, and more people should be employed.

The government has done its bit, and now it is time for the private sector to open its purse strings and contribute to the overall growth.

 

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