ECONOMICS

UAE Economy

UAE Economy

Introduction

This essay mainly focuses on the economy of UAE and has considered an article which is based on the variations of the real GDP and nominal GDP of the UAE. It has been observed that the nominal gross domestic product reached to DH 1.24 trillion last year, which was approximately greater than DH 1.04 trillion that was recorded in the year 2010.

Summary

In the article “The UAE economy to slow down 3pc this year” there are some of the factors which reveal several deviating approximates in terms of the actual growth rate of UAE's GDP, however, the available statistics identifies that in recent times UAE is notable economy which is the one among the fastest growing economies of the world. From the article, it has also been identified that UAE economy is expected to slow down for 3 percent in the year 2012 which is because of the combination of several external factors that includes reduction in the oil prices, gloomy outlook of international economy and eurozone crisis, as compare to the growth of 4.2 percent recorded last year (Zaher, 2012). The UAE economy has integrated with the international economical growth and it has also increased its reliance with those markets as well.

The economy of UAE is considered as an open economy, and its economic performance is directly related with the economic situations of Europe and United States. If they hold better economic conditions then the UAE economy would become better. There are some of the reasons for the slowdown in the GDP in which rate of inflation is among them. The inflation rate in 2011 was recorded was 0.88 which was almost the same as recorded in the year 2010. But in the year 2012, it has been estimated to be increased by 1.5 percent which is because of the world economy and oil prices. Because of the adjustments in the inflation, the real GDP has been adjusted and reached at DH 981.6 billion, which is up from DH 942 billion.

The economy Of UAE is identified in very interesting situation in which its economy is still growing whereas the global economy is exposed to face challenges at the same time (Zaher, 2012). However, after the fluctuation in the construction and real estate sectors, they are still contributing 10 percent to the Gross Domestic Product of the economy. Reduction has been identified in the contribution ...