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The UAE registered GDP growth of 2.2% in Q1 2019 versus the same period last year, backed by continued momentum in the non-oil sector as a result of government spending, according to the Central Bank of the UAE. The non-oil sector expanded 1.6% during the period.
Growth in the UAE’s non-oil economy has been stimulated by a number of recently introduced government-led initiatives. Earlier in 2019, the UAE government launched 10-year visas to promote long-term residency and attract foreign investment. Foreign ownership requirements were also relaxed with foreign investors being allowed to own 100% in companies in certain sectors. A three-year AED 50 billion economic stimulus package for Abu Dhabi was also announced last year.
According to the central bank, inflation for the quarter declined as a result of of the fading impact of VAT, and private sector employment rebounded during the same period, rising 1.2%.
Financial Soundness Indicators continued to support the UAE’s banking system and private sector deposits continued to rise in the first quarter of 2019, along with gross credit by the central bank for most sectors, it noted.
In May, the central bank revised its overall 2019 economic growth outlook to 2% from 3.5% in response to global concerns of an economic slowdown.
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