The economic outlook of the United Arab Emirates (UAE) is showing signs of resilience and growth, as recent reports highlight significant increases in various financial sectors. The Central Bank of the UAE (CBUAE) has reported remarkable growth of its gold reserves, reflecting broader economic trends and increased financial activity within the nation.
According to the latest figures, the gold reserves of the CBUAE surged by 34.8 percent during the first 10 months of 2024, reaching AED 24.464 billion (approximately $6.7 billion) by the end of October 2024. This was not only a substantial increase compared to AED 23.185 billion ($6.3 billion) at the end of September but also represented a month-on-month boost of 5.5 percent or AED 1.28 billion ($348.5 million). These figures were detailed in the Central Bank’s Monthly Statistical Bulletin, which indicates the strong recovery and growing confidence in the UAE's economy following challenges posed by previous global uncertainties.
Further financial insights reveal the total demand deposits exceeded AED 1.078 trillion ($293.5 billion), with AED 781.528 billion ($212.7 billion) reflecting local currency holdings. Meanwhile, savings deposits reached AED 308.239 billion ($84 billion), with around AED 259.1 billion ($70.5 billion) denominated in the dirham. The bulletin also recorded time deposits amounting to AED 926.921 billion ($252.4 billion), indicating increasing investor confidence and liquidity within the banking sector.
Another significant indicator of financial health is the increase in net international reserves held by the UAE banking sector. These reserves climbed to AED 1.406 trillion ($382.8 billion) by the end of October, up from AED 1.317 trillion ($358.6 billion) the previous month. This upward trend reflects improved banking metrics and growing international trust in the UAE's financial system.
On the transactional side, the statistics disclosed by the Central Bank revealed the value of transactions processed through the UAE Fund Transfer System (UAEFTS) exceeded AED 16.137 trillion ($4.4 trillion) during the first ten months of 2024. This volume reflects the UAE’s position as a significant hub for financial activities and cross-border transactions.
Cheque transactions also saw substantial activity, with the value of processed cheques reaching AED 1.1 trillion ($299.4 billion) during the first ten months, which is indicative of the continued reliance on traditional payment methods by various sectors.
Adding to these financial updates, the UAE is also strengthening its international partnerships to combat global financial crimes, particularly financial fraud and corruption. Recently, UAE Minister of Justice Abdullah Sultan Bin Awad Al Nuaimi met with his French counterpart, Gérald Darmanin, to reinforce judicial cooperation focused on tackling organized crime and ensuring safe financial practices. Both nations are committed to working collaboratively on various files of shared interest, emphasizing the importance of exchanging expertise and bolstering global cooperation to address these urgent issues.
Following the meeting, Minister Al Nuaimi expressed the UAE's commitment to adhering to best practices in fighting illicit financing and criminal activities, which he noted as both a moral and legal obligation. This focus on financial integrity is viewed as integral to maintaining the confidence of international partners and investors.
Meanwhile, the UAE continues to engage with European Union representatives to address its inclusion on the EU's blacklist of countries deficient in fighting money laundering. Economy Minister Abdulla bin Touq Al Marri expressed confusion over the UAE’s continued presence on this list, especially after successfully exiting the 2022 gray list from the Financial Action Task Force (FATF). He underscored the UAE's proactive measures and improvements made to its financial systems, which contributed to the removal from the gray list and emphasized the nation's stance on improving its global financial reputation.
Regarding trade relations with the EU, Minister Al Marri voiced concerns about potential penalties on imports, particularly relating to EU's labor requirements for trading nations. He asserted the importance of respecting individual member nations’ labor systems and management practices, indicating this approach could challenge the oil and natural gas sectors.
Despite the nuances of these international agreements and the challenges presented, the UAE holds firm on its position of not implementing income taxes, categorically stating, "It’s not on the table. It’s not being discussed," reinforcing the country’s intent to maintain its favorable business environment.
Overall, the UAE's increasing financial metrics, commitment to combating financial misconduct, and diplomatic engagements with international partners suggest a progressive outlook for the nation’s economy as it navigates the global financial landscapes of 2024.