{
  "title": "IMF Staff Concludes Visit to the United Arab Emirates",
  "publication": "IMF News, May 2, 2019",
  "sourceUrl": "https://www.imf.org/en/news/articles/2019/05/02/pr19138-uae-imf-staff-concludes-visit-to-the-united-arab-emirates",
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  "summary": "Mission led by Mr. Koshy Mathai visited the United Arab Emirates (UAE) from April 23 to May 1, 2019.",
  "publishDate": "2019-05-02",
  "sections": [
    {
      "heading": "Mission context and timeline",
      "content": "- Mission led by Mr. Koshy Mathai visited the United Arab Emirates (UAE) from April 23 to May 1, 2019.\n- Press Release No. 19/138 dated May 2, 2019.\n- End-of-Mission press release conveying preliminary IMF staff findings; the mission will not result in a Board discussion."
    },
    {
      "heading": "Recent macroeconomic developments and outlook",
      "content": "- The UAE economy continued to adjust in 2018 amid corporate consolidation and structural reforms in large government-related entities (GREs) and commercial banks.\n- Given the dollar peg:\n  - the dirham appreciated against currencies of major trading partners;\n  - interest rates rose in general.\n- External environment pressures included weaker external demand and intensified geopolitical tensions.\n- Growth and sector outcomes:\n  - Non-oil growth slowed to 1.3 percent in 2018.\n  - The overall economy grew at 1.7 percent in 2018, benefiting from increased oil production.\n- Emerging positive signals:\n  - Domestic credit growth, employment, and tourist arrivals showing improvement recently.\n  - Real estate sector continues to face an overhang of supply.\n- Turning-point factors and outlook:\n  - Public spending support: a substantial amount of Expo 2020 investment should be completed by end-year; some GREs are embarking on new investment plans; implementation of emirate-level stimulus is expected to accelerate.\n  - External tailwinds: higher oil prices and the pause in Fed tightening.\n  - Growth projections: growth could exceed 2 percent this year and approach 3 percent in 2020-21."
    },
    {
      "heading": "Policy analysis and recommendations",
      "content": "- Overarching challenge:\n  - Sustaining rapid growth after Expo 2020, and without policy stimulus, will require capitalizing on new growth drivers decoupled from oil prices, which in turn requires enhanced structural reforms.\n- Reduce the footprint of the public sector:\n  - Level the playing field between GREs and private-sector participants to boost productivity growth and foster diversification.\n  - Strengthen the enabling environment for SMEs.\n  - Build on recent reforms to encourage foreign direct investment (FDI).\n- Modernize the labor market:\n  - Create a more competitive and less fragmented labor market to direct talent to its most productive uses.\n  - Support the objective of employing more nationals in the private sector while ensuring the UAE continues to attract and retain expatriate talent.\n- Strengthen the financial markets:\n  - Recent adoption of the federal debt law is welcome.\n  - Issuance of local-currency government securities should proceed to establish a benchmark yield curve.\n  - The central bank law was another major accomplishment.\n  - Central Bank of the UAE (CBUAE) efforts to strengthen the financial system should continue, including moving toward Basel III and adopting International Financial Reporting Standards (IFRS) 9.\n- Foster policy coordination and transparency:\n  - Improve information sharing among federal and emirate-level authorities and coordinate their decisions for better policy outcomes.\n  - Adopt a more explicit medium-term fiscal framework, involving rules guiding the balance between economic stabilization and saving for future generations.\n  - Share additional information on policymaking with the public to boost consumer and business confidence."
    },
    {
      "heading": "Mission engagement",
      "content": "- The mission met H.E. Mubarak Al Mansoori, Governor of the Central Bank of the UAE; H.E. Younis Haji Al-Khoori, Undersecretary of the Ministry of Finance; H.E. Mohamed Al Hameli, Acting Undersecretary of the Abu Dhabi Department of Finance; H.E. Khalid Al Bustani, Director General of the Federal Tax Authority; and H.E. Huda Al Hashimi, Assistant to the Director General for Strategy and Innovation at the Prime Minister’s Office, along with other senior officials and private sector representatives.\n- The IMF team expressed thanks to the authorities for their hospitality and frank discussions.\n\nPress Release No. 19/138 — May 2, 2019.\n\n---\n\n\n References\n\n- United Arab Emirates and the IMF\n- Press Releases\n- PRESS CENTER\n- https://www.imf.org/en/home\n\nSource: https://www.imf.org/en/news/articles/2019/05/02/pr19138-uae-imf-staff-concludes-visit-to-the-united-arab-emirates"
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    "Published: May 2, 2019",
    "Mission led by Mr. Koshy Mathai visited the United Arab Emirates (UAE) from April 23 to May 1, 2019.",
    "Press Release No. 19/138 dated May 2, 2019.",
    "End-of-Mission press release conveying preliminary IMF staff findings; the mission will not result in a Board discussion.",
    "The UAE economy continued to adjust in 2018 amid corporate consolidation and structural reforms in large government-related entities (GREs) and commercial banks.",
    "Given the dollar peg:",
    "External environment pressures included weaker external demand and intensified geopolitical tensions.",
    "Growth and sector outcomes:",
    "Emerging positive signals:",
    "Turning-point factors and outlook:",
    "Overarching challenge:",
    "Reduce the footprint of the public sector:",
    "Modernize the labor market:",
    "Strengthen the financial markets:",
    "Foster policy coordination and transparency:",
    "The mission met H.E. Mubarak Al Mansoori, Governor of the Central Bank of the UAE; H.E. Younis Haji Al-Khoori, Undersecretary of the Ministry of Finance; H.E. Mohamed Al Hameli, Acting Undersecretary of the Abu Dhabi Department of Finance; H.E. Khalid Al Bustani, Director General of the Federal Tax Authority; and H.E. Huda Al Hashimi, Assistant to the Director General for Strategy and Innovation at the Prime Minister’s Office, along with other senior officials and private sector representatives.",
    "The IMF team expressed thanks to the authorities for their hospitality and frank discussions.",
    "[United Arab Emirates and the IMF](http://www.imf.org/external/country/ARE/index.htm)",
    "[Press Releases](https://www.imf.org/en/news/searchnews)",
    "[PRESS CENTER](http://presscenter.imf.org/)",
    "[https://www.imf.org/en/home](https://www.imf.org/en/home)"
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