Meed | UAE economy maintains robust growth

UAE economy maintains robust growth

25 October 2023

UAE economic growth is largely on track as projected in 2023, with the growth estimates and forecasts remaining much as they were earlier in the year.

The latest estimates from the Washington-based IMF indicate a 3.4 per cent real GDP growth rate for the year, down only 0.1 per cent from the 3.5 per cent projected in April 2023, and still comfortably ahead of the global growth forecast of 3 per cent. The economy is then projected to pick up tempo in 2024 to a growth rate of 4 per cent.

The growth of the UAE’s non-oil economy has been higher than its oil growth over the course of 2023, with the IMF expecting the non-oil growth rate for the year to exceed 4 per cent, benefitting from strong domestic activity. It also projects a repeat of this performance in 2024.

The repeated extensions of the Opec+ production cuts have affected the country’s oil sector growth. However, the UAE’s oil output is set to accelerate next year with the UAE’s 2024 Opec+ production quota increase.

Consumer price inflation in the country is expected to have eased to an annual average of 3.1 per cent by the end of the year, compared to 4.8 per cent in 2022. This is then forecast to ease further to about 2.3 per cent in 2024, or roughly baseline levels.

Ali al-Eyd, the leader of an IMF team that visited the UAE in September, noted that “fiscal and external surpluses remain high on the back of high oil prices. The fiscal balance is expected to be around 5 per cent of GDP in 2023, driven by oil revenue and strong economic activity”.

Speaking to the broader fiscal and structural reforms under way in the UAE, Al-Eyd added: “The phased introduction of a corporate income tax that began in June 2023 will support higher non-oil revenue over the medium term.

“Public debt is projected to continue to decline, falling firmly below 30 per cent of GDP in 2023, including with the benefit of the Dubai emirate reducing its public debt by AED29bn ($7.9bn) in line with its Public Debt Sustainability Strategy. The current account surplus is expected to be notably above the medium-term level in 2023 and 2024.”

Surge in activity

In the latest assessments of business activity in the country, measured through the S&P Global purchasing managers’ index (PMI) survey, the UAE has shown an uptick in September, with the index rising to 56.7, where a value over 50 denotes growth.

This is up from 55 the previous month and is the most significant leap for the index since June, indicating a positive turn for the country’s non-oil private sector.

The index performance was driven by a rise in new orders, the sub-index for which reached 64.7 in September in a significant jump from 57.6 in the preceding month. This reflects a level of new order growth not witnessed since June 2019, and the evidence of rising demand came from across both domestic and external markets.

According to S&P, “the rate of new order growth was sharp and faster than the trend observed since the survey began in August 2009”.

The output sub-index also climbed to 62.8 in September, up from 61.9 the previous month, reflecting the influx of new orders, while there was also a knock-on boost to hiring, with non-oil firms reporting an increase in employment.

Below the country level, the PMI index for Dubai reached its highest level in three months, rising to 56.1 in September, up from 55.0 in August.

According to S&P, the index has averaged 55.5 over the first three quarters of the year, paralleling the first nine months of 2022, and this consistency aligns with a forecast of 4.0 per cent real GDP growth for Dubai in 2023.

There was a surge in new orders in Dubai, similarly to the fastest rate since mid-2019. According to Daniel Richards, senior Middle East and North Africa economist at Emirates NBD, this in turn “also boosted business confidence, which rose to the highest level since March 2020, just before the Covid-19 pandemic crisis took hold”.

Despite rising input costs, which saw the most substantial increase since July 2022, “the strong orderbook outweighed the impact of rising costs on sentiment”, notes Richards.

Growth areas

In terms of the sectors of growth, both the construction sector and wholesale and retail trade exhibited robust performances. The construction index reached a three-month high, rising to 54.5, and the wholesale and retail trade index reached 56.5, helping to lead the overall index score for Dubai.

The positive outlook in retail resulted in the fastest employment growth in that sector since May 2019.

Looking ahead, the UAE is addressing the central issues of energy transition through the lens of its UAE Energy Strategy 2050 and UAE Net Zero 2050 in the lead up to the UN Cop28 climate summit in November, while other areas of strategic focus for 2050 remain economic diversification, trade partnerships, digitalisation and green initiatives.

MEED’s November 2023 special report on the UAE includes:

> COMMENT: UAE eyes global leadership role
> POLITICS: Abu Dhabi networks on the global stage
> ECONOMY: UAE economy maintains robust growth
> BANKING: UAE banks enjoy the good times
> UPSTREAM: Hail and Ghasha galvanises UAE upstream market
> DOWNSTREAM: Adnoc spurs downstream gas expansions
> POWER: UAE closes ranks ahead of Cop28
> WATER: UAE ramps up decarbonisation of water sector
> PROJECTS: Top 10 UAE clean energy projects
> CONSTRUCTION: UAE construction sector returns to form
> TRANSPORT: UAE aviation returns to growth

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John Bambridge

Exclusive from Meed

Tender issued for Libyan gas project
17 September 2026
Aldar and Mubadala acquire Masdar City Square
17 September 2026
Dubai announces new 80km highway corridor
16 September 2026
Engineering progresses on Ras Laffan LNG terminal berths
16 September 2026
Design completed for Libyan oil field development
16 September 2026

Tender issued for Libyan gas project
17 September 2026
An invitation to bid has been issued for a contract to conduct environmental assessments for the project to expand the Mellitah oil and gas complex in Libya.

The bid submission deadline is 2pm today (17 September) Libyan time.

The scope of the project includes provision of:
- An environmental baseline study (EBS)
- An environmental impact assessment (EIA)
- An environmental management plan (EMP)
The client is Mellitah Oil & Gas (MOG), which is a joint venture of Italy’s Eni and Libya’s National Oil Corporation (NOC).

MOG is based in Tripoli and operates both onshore and offshore oil and gas facilities.

The joint venture owns and operates six major oil and gas fields across the North African country.

According to the tender documents, the company that is awarded the contract will need to prepare environmental management measures in compliance with:
- Libyan environmental legislation
- Ministry of Environment requirements
- NOC environmental guidelines
- Applicable international environmental standards and best practices
The expansion of the Mellitah oil and gas complex is part of a project estimated to be worth $8bn.

The wider project is known as the Mellitah Complex Expansion & CO2 Management Integrated Development Project.

It has six main packages:
- Onshore package
- Offshore Structure A
- Offshore Structure E
- Subsea pipeline package
- Site preparation work
- Carbon capture and storage facility
Security issues and political instability have been a major problem for Libya’s oil and gas sector since the country’s civil war started in 2011.

Earlier this month, the Mellitah oil and gas complex was forced to shut down temporarily due to a protest over deteriorating public services.

The existing onshore complex includes housing, processing units, storage facilities and export facilities.

It also serves as the launch point for the Greenstream pipeline, which delivers Libyan gas directly to Italy.

The planned expansion of the complex will involve:
- Construction of a new fourth gas processing train
- Construction of a third condensate train
- Construction of a third natural gas liquids fractionation train
- Construction of a fourth sulphur recovery unit train
- Installation of a hydrogen sulphide enrichment unit
- Installation of a sulphur recovery unit
- Construction of other associated facilities
The Mellitah complex is located about 100 kilometres west of Tripoli and is a key energy facility in the west of the country.
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Wil Crisp
Aldar and Mubadala acquire Masdar City Square
17 September 2026

Abu Dhabi-based sovereign wealth fund Mubadala Investment Company and local developer Aldar have completed the acquisition of Masdar City Square at Masdar City, in a transaction valued at AED918m ($250m).

The deal was executed through their joint venture established in 2024.

Masdar City Square comprises more than 47,000 square metres (sq m) of net leasable area across seven office buildings.

Completed in Q1 2026, the development is 99% occupied. Tenants include Taqa, the Department of Energy, Emirates College and the Mohamed Bin Zayed University of Artificial Intelligence.

The transaction expands the joint venture’s real estate portfolio in Masdar City, which is now valued at AED4.7bn ($1.3bn).

Masdar City is one of the region’s leading hubs for clean energy, artificial intelligence, advanced research and sustainable urban development.

The joint venture acquired The Link project at Masdar City for AED654m ($178m) in April.

Comprising about 32,000 sq m of net leasable area across five buildings, The Link is fully leased to a portfolio of major tenants, including Abu Dhabi Future Energy Company (Masdar) and the Mohamed Bin Zayed University of Artificial Intelligence.

The asset includes Grade A, Leed Platinum office space, a net-zero-energy headquarters building, a multi-use hall and residential accommodation, supporting its position as a high-performing, integrated component of Masdar City.

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Yasir Iqbal
Dubai announces new 80km highway corridor
16 September 2026

Dubai has approved the construction of the new fourth corridor, a major highway programme aimed at boosting inter-emirate connectivity, increasing road capacity and easing congestion.

The corridor will extend 80 kilometres, from Al-Faya Road in Abu Dhabi to Al-Shanouf Road in Sharjah.

It will include 12 lanes, 72 bridges and 17 tunnels.

The project is expected to reduce travel times by up to 60% and serve more than 3.1 million people, while providing links to Al-Maktoum International airport and Etihad Rail.

It will have the capacity to accommodate 24,000 vehicles per hour in each direction.

The project will be delivered in two phases. The first phase, running from Al-Shanouf Road to Dubai-Al Ain Road, will be delivered at a cost of AED3.5bn ($953m).

The second phase will stretch from Dubai-Al Ain Road to Al-Faya Road in Abu Dhabi.

Hamdan bin Mohammed: In line with the directives of His Highness Sheikh Mohammed bin Rashid Al Maktoum to boost investment in infrastructure, I approved the New Fourth Corridor to strengthen Dubai’s road network and enhance connectivity with the UAE’s federal road network.… pic.twitter.com/zlIyY2yKBN

— Dubai Media Office (@DXBMediaOffice) September 16, 2026

The scheme adds a fourth spine to a network that has long relied on three main corridors: the E11 (Sheikh Zayed Road/Al-Ittihad Road); the E311 (Sheikh Mohamed Bin Zayed Road) and the E611 (Emirates Road), which together carry more than 850,000 vehicles commuting between Dubai and the northern emirates daily.

That concentration has made the route one of the country’s most congested, with peak-hour bottlenecks a persistent problem for residents. The new corridor is designed to divert a significant share of that traffic onto a higher-capacity route, rather than add pressure to the existing network.

The project also aligns with the Dubai 2040 Urban Master Plan, which anticipates population growth to 5.8 million by 2040 and calls for the expansion of roads, railways, airports and ports to support that growth and reinforce Dubai’s position as a global trading hub. This is reflected in the corridor’s direct links to Al-Maktoum International airport and Etihad Rail.

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Yasir Iqbal

Engineering progresses on Ras Laffan LNG terminal berths

16 September 2026

Register for MEED’s 14-day trial access

Front-end engineering and design (feed) works are progressing on a QatarEnergy LNG project to build 13 liquefied natural gas (LNG) loading berths at the south export terminal in Qatar’s Ras Laffan Industrial City.

Ras Laffan Industrial City, which lies about 90 kilometres north of Doha, is the world's largest integrated LNG production and export complex, comprising 15 processing trains with a total capacity of 77.5 million tonnes a year (t/y). QatarEnergy began LNG operations at the facility, which houses all its processing trains and export infrastructure, in 1984.

According to sources, QatarEnergy LNG, a subsidiary of state enterprise QatarEnergy, awarded the feed contract for the project to build 13 LNG berths at the south export terminal at Ras Laffan to Australia-headquartered Worley.

The contract was awarded to Worley in the second quarter of this year. Its duration is estimated to be 200,000-250,000 man hours, sources told MEED.

Ras Laffan’s LNG processing and export capabilities will increase by up to about 63% when the three phases of QatarEnergy’s estimated $40bn North Field LNG expansion project come into operation by the end of this decade. Engineering, procurement and construction (EPC) works on all three projects are progressing.

QatarEnergy is understood to have committed nearly $30bn to the first two phases – North Field East (NFE) and North Field South (NFS) – which will lift Qatar’s LNG production capacity from 77.5 million t/y to 126 million t/y by 2028.

QatarEnergy awarded the main EPC contracts for NFE in 2021. The project was intended to raise LNG output to 110 million t/y by 2025. The $13bn EPC package – covering the engineering, procurement, construction and installation of four LNG trains, each with a capacity of 8 million t/y – was awarded in February 2021 to a consortium of Japan’s Chiyoda and France’s Technip Energies.

In May 2023, QatarEnergy awarded the $10bn main EPC contract for NFS to a consortium of Technip Energies and Consolidated Contractors Company (CCC). The contract includes two LNG trains, each with a capacity of 7.8 million t/y.

Once fully operational, the first two phases are expected to add 48 million t/y of LNG supply to the global market.

QatarEnergy took the final investment decision on the third phase, North Field West (NFW), this year, awarding an EPC contract estimated at $8bn to a joint venture comprising Technip Energies, CCC and Gulf Asia Contracting in February.

Chiyoda carried out the feed work for the NFW LNG project.

The NFW scope covers the EPC of two LNG trains with a combined capacity of 16 million t/y, as well as associated facilities for gas treatment, natural gas liquids recovery and helium extraction.

In addition to LNG, NFW is expected to produce about 175,000 barrels of oil equivalent a day of condensate, ethane and liquefied petroleum gas.

With all three phases under EPC execution – and NFE scheduled for commissioning later this year – QatarEnergy is positioning itself to remain one of the world’s largest LNG suppliers in the long term.

READ THE SEPTEMBER 2026 MEED BUSINESS REVIEW – click here to view PDF

Nuclear power ambitions gather pace; Kuwait keeps dealmaking alive despite war; Region invests in raising gas processing capacity.

Distributed to senior decision-makers in the region and around the world, the September 2026 edition of MEED Business Review includes:

> AGENDA: Gulf nuclear revival takes shape

> MARKET FOCUS: Kuwait keeps dealmaking alive under fire

> INDUSTRY REPORT: Gas processing takes centre stage in Mena region

> INTERVIEW: Emsteel persists with business productivity and efficiency

> TUNNELS: The Gulf’s next construction boom is happening underground

To see previous issues of MEED Business Review, please click here

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Indrajit Sen

Design completed for Libyan oil field development

16 September 2026

Register for MEED’s 14-day trial access

Design work has been completed for a project to develop Libya’s I/R oil field, according to industry sources.

The front-end engineering and design work was completed by a team in the London offices of Italy’s EniProgetti and paves the way for the main engineering, procurement and construction contract to be tendered.

One source said: “At the moment, there is no fixed date for when the invitation to bid for the main contract will be issued, but the project has a lot of momentum and is progressing towards tendering.”

The I/R oil field is located in Murzuq Basin in southwestern Libya.

In June this year, Libya's National Oil Corporation (NOC) signed a unified operating agreement for the field.

The I/R field is operated by Akakus Oil Operations, which is a joint venture of NOC in partnership with Spain’s Repsol, France’s TotalEnergies Repsol, Austria’s OMV and Norway’s Equinor.

The agreement in June was signed by NOC as well as its concession partners.

NOC said the agreement would unify operational and administrative procedures related to field management, optimise resource utilisation and support production sustainability.