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Quarterly 21 January 2014 Khatija Haque Head of MENA Research +971 4 509 3065 [email protected] Jean Paul Pigat MENA Economist +971 4 230 7807 [email protected] MENA Quarterly The dichotomy in economic performance between oil exporters and oil importers in the MENA region is expected to continue in 2014. GCC governments are expected to maintain relatively high levels of spending, underpinning growth in the non-oil sectors of their economies, while continuing to post substantial budget and current account surpluses. In contrast, oil importers have limited room to maneuver as fiscal and external deficits remain significant, and against a backdrop of political transition which has limited their governments’ abilities to adjust macroeconomic policy. In 2014, we expect GCC growth to again average 4.3%, driven mainly by the non- oil sectors. We expect Qatar and the UAE to be the fastest growing economies in the GCC this year, with real GDP expanding 5.2% and 4.5% respectively. Kuwait is likely to remain the laggard of the region in terms of growth. The average fiscal surplus of the oil exporting countries is expected to narrow to 6.1% of GDP in 2014 on slightly lower oil prices (consensus forecast USD 100/bbl, down from USD 105/ bbl in 2013); and as expenditure continues to rise. Oman and Bahrain are forecast to run budget deficits this year. The outlook for MENA’s net oil importers in 2014 is cautiously optimistic. We forecast average real GDP growth of 3.0% on a GDP-weighted basis, compared to an estimated 2.4% in 2013. Morocco is again expected to be the fastest growing economy among the oil importers, with growth forecast at 4.2% in 2014. The aggregate budget deficit for oil importers is expected to narrow to -9.4% of GDP this year from -11.0% in 2013. In Jordan and Lebanon, the outlook is tempered by the negative spillovers stemming from the crisis in Syria, while a degree of caution is warranted in North Africa due to the slow pace of economic reform and ‘event risks’ associated with upcoming elections in Egypt and Tunisia. MENA in 2014: A tale of two regions Regional aggregates are weighted by nominal GDP Source: Emirates NBD Research 4.3 17.7 6.1 3.6 3.0 -4.2 -9.4 7.8 -15 -10 -5 0 5 10 15 20 GDP growth (%) Current Account (% GDP) Budget Balance (% GDP) Inflation (%) GCC MENA oil importers

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Page 1: MENA Quarterly - Emirates NBD · economy among the oil importers, ... MENA Quarterly ... We expect Qatar and the UAE to be the fastest growing economies in

Quarterly 21 January 2014

Khatija Haque Head of MENA Research +971 4 509 3065 [email protected] Jean Paul Pigat MENA Economist +971 4 230 7807 [email protected]

MENA Quarterly The dichotomy in economic performance between oil exporters and oil importers in

the MENA region is expected to continue in 2014. GCC governments are expected to maintain relatively high levels of spending, underpinning growth in the non-oil sectors of their economies, while continuing to post substantial budget and current account surpluses. In contrast, oil importers have limited room to maneuver as fiscal and external deficits remain significant, and against a backdrop of political transition which has limited their governments’ abilities to adjust macroeconomic policy.

In 2014, we expect GCC growth to again average 4.3%, driven mainly by the non-oil sectors. We expect Qatar and the UAE to be the fastest growing economies in the GCC this year, with real GDP expanding 5.2% and 4.5% respectively. Kuwait is likely to remain the laggard of the region in terms of growth.

The average fiscal surplus of the oil exporting countries is expected to narrow to 6.1% of GDP in 2014 on slightly lower oil prices (consensus forecast USD 100/bbl, down from USD 105/ bbl in 2013); and as expenditure continues to rise. Oman and Bahrain are forecast to run budget deficits this year.

The outlook for MENA’s net oil importers in 2014 is cautiously optimistic. We forecast average real GDP growth of 3.0% on a GDP-weighted basis, compared to an estimated 2.4% in 2013. Morocco is again expected to be the fastest growing economy among the oil importers, with growth forecast at 4.2% in 2014. The aggregate budget deficit for oil importers is expected to narrow to -9.4% of GDP this year from -11.0% in 2013.

In Jordan and Lebanon, the outlook is tempered by the negative spillovers stemming from the crisis in Syria, while a degree of caution is warranted in North Africa due to the slow pace of economic reform and ‘event risks’ associated with upcoming elections in Egypt and Tunisia.

MENA in 2014: A tale of two regions

Regional aggregates are weighted by nominal GDP Source: Emirates NBD Research

4.3

17.7

6.1 3.6 3.0

-4.2

-9.4

7.8

-15

-10

-5

0

5

10

15

20

GDP growth (%) Current Account(% GDP)

Budget Balance(% GDP)

Inflation (%)

GCC MENA oil importers

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Contents

GCC Overview .......................................................................................................................... Page 3

MENA Oil Importers ................................................................................................................ Page 5

Bahrain ......................................................................................................................................... Page 7

Egypt............................................................................................................................................. Page 8

Jordan .......................................................................................................................................... Page 9

Kuwait ........................................................................................................................................ Page 10

Lebanon ..................................................................................................................................... Page 11

Morocco ..................................................................................................................................... Page 12

Oman .......................................................................................................................................... Page 13

Qatar ........................................................................................................................................... Page 14

Saudi Arabia ............................................................................................................................. Page 15

Tunisia........................................................................................................................................ Page 16

UAE ............................................................................................................................................ Page 17

UAE - Dubai ............................................................................................................................. Page 19

Key Economic Forecasts..................................................................................................... Page 20

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GCC Overview The GCC enjoyed solid growth – we estimate 4.3% on a weighted average basis - in 2013, likely outperforming advanced economies, central and eastern Europe, CIS and Latin America and the Caribbean (IMF WEO projections, October 2013). Nevertheless, GCC growth last year was markedly slower than 2012, which had benefitted from a substantial increase in oil production across the region. Fiscal and external balances in 2013 were supported by a stable oil price, which averaged USD 105/bbl. This year, we expect GCC growth to average around 4.3%, driven mainly by the non-oil sectors in most of the GCC. Inflation is expected to rise to 3.6% on average this year from 2.7% in 2013.

Oil price and output broadly stable in 2013 Bloomberg data shows that total oil production for the GCC’s OPEC members in 2013 was largely unchanged from 2012, at 15.9bn bpd. However, there was significant variation in oil output between the GCC member states. The UAE (+4.7% to 2.8mn bpd) and Kuwait (+5.3% to 2.9mn bpd) increased oil production last year, while Saudi Arabia (-2.4% to 9.5mn bpd) and Qatar (-5.2% to 0.7mn bpd) reduced their output. Oman and Bahrain, which are not OPEC members, also saw oil production increase in 2013, contributing to their relatively high overall growth. OPEC’s reference oil price averaged just over USD 105 /bbl in 2013, -3.3% lower than 2012. Oil prices have been relatively stable by historical standards – the standard deviation in the OPEC reference price over the last 3 years has been just USD 6.5 /bbl compared with a standard deviation of USD 27 /bbl over the last decade. Bloomberg consensus forecasts for 2014 put the oil price at USD 100 /bbl (average of WTI and Brent forecasts), -5.5% lower than 2013. Overall, we expect oil production to remain broadly stable for the GCC as a whole in 2014. Many analysts have highlighted the downside risks to oil production, particularly in Saudi Arabia, as Iraq, Iran and Libya are expected to boost their supply onto the global market. While Iraq did increase output in Q4 2013, there is little sign yet that Libya has resolved the disputes that have disrupted production and exports since last summer. At this stage, we are projecting no change to Saudi Arabia’s average oil production in 2014. We also think the UAE and Kuwait could increase oil output marginally this year, but at a slower pace than 2013. However, oil is unlikely to contribute significantly to aggregate real GCC growth this year, in our view. Non-oil sector to be the engine of GCC growth in 2014 We expect Qatar and the UAE to be the fastest growing economies in the GCC this year. In Qatar’s case, government spending on infrastructure is likely to remain a key driver of non-oil growth, as the country continues to prepare for the FIFA World Cup in six years’ time. We expect growth to slow to 5.2% from an estimated 6.0% in 2013.

GCC oil output and reference price

Source: Bloomberg, Emirates NBD Research

Libya, Iraq, Iran oil output

Source: Bloomberg, Emirates NBD Research

2014 real growth forecasts

Source: Emirates NBD Research

10

12

14

16

18

20

0

20

40

60

80

100

120

140

Jan-12 May-12 Sep-12 Jan-13 May-13 Sep-13

mn

barre

ls p

er d

ay

US

D p

er b

arre

l

GCC oil production (excl Oman, Bahrain)

OPEC reference price

0

1

2

3

4

Jan-12 May-12 Sep-12 Jan-13 May-13 Sep-13

mn

bpd

Iraq Libya Iran

5.2

4.5 4.3 4.2 4.0

3.0

0

1

2

3

4

5

6

7

Qatar UAE Bahrain SaudiArabia

Oman Kuwait

%

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In the UAE, the authorities have run a tighter fiscal policy, and we expect this to remain the case in 2014, with expenditure growth forecast at 3.2% y/y. Instead, we anticipate UAE growth will continue to come from the domestic private sector, supported by external demand as the global economy strengthens. Consumer and investor confidence has been buoyed by the sharp recovery in real estate prices and winning the right to host Expo 2020. Private sector credit growth is accelerating and the tourism and hospitality sectors continue to show robust growth. Consequently, we expect the non-oil sectors to compensate for slower growth in the hydrocarbon sector, and project overall GDP growth of 4.5% this year. A decline in oil production was the main reason Saudi Arabia’s GDP growth slowed to 3.8% last year, according to official estimates, from 5.8% in 2012. However, the pace of non-oil growth in the kingdom was also slower than we had expected at the start of last year, with PMI readings last year consistently lower than the corresponding months in 2012. For 2014, our base case is for stable oil production, and non-oil growth of around 5.4%. Overall, we expect real growth of 4.2% in Saudi Arabia this year. Kuwait has likely been the laggard of the region in terms of growth in 2013, despite an estimated 5.3% increase in oil production, as non-oil expansion has been hampered by political uncertainty and lack of progress in implementing the economic development plan. At this stage, prospects for 2014 are not looking much better, and we expect growth to remain in the low single digits. We expect growth in Oman and Bahrain to slow to 4.0% and 4.3% in 2014, from 4.7% and 4.8% respectively in 2013, largely on the back of moderating oil production after a strong 2013. We also anticipate that both economies will run budget deficits this year, as oil revenues fail to keep pace with government spending. Indeed the average GCC fiscal surplus is expected to narrow to 6.1% of GDP in 2014 from an estimated 8.4% in 2013, as expenditure growth outpaces revenue growth. Inflation likely to accelerate in 2014 Consumer inflation surprised on the downside across most of the GCC in 2013, relative to our forecasts at the start of last year. We estimate average inflation of 2.7% (weighted by nominal GDP) for the GCC, up from 2.3% in 2012. This year we expect consumer inflation to accelerate to 3.6% as higher housing costs feed through to the official indices, and as rising input costs are increasingly passed on to consumers.

PMIs show strong non-oil growth

Source: Markit/ HSBC, Emirates NBD Research

GCC average* fiscal balance

* Average weighted by nominal GDP Source: Haver Analytics, Emirates NBD Research

GCC average* inflation

* Average weighted by nominal GDP Source: Haver Analytics, Emirates NBD Research

50

55

60

65

Jan-12 May-12 Sep-12 Jan-13 May-13 Sep-13

UAE Saudi Arabia

3.5

10.8

12.5

8.4

6.1 5.3

0

2

4

6

8

10

12

14

2010 2011 2012e 2013f 2014f 2015f

% G

DP

0

1

2

3

4

5

2010 2011 2012 2013e 2014f 2015f

%

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MENA Oil Importers The outlook for MENA’s net oil importers (Egypt, Jordan, Lebanon, Morocco and Tunisia) in 2014 is slightly more optimistic compared to last year. Our regional weighted average real GDP growth projection currently stands at 3.0%, compared to an estimated 2.4% in 2013. Of course, these rates of economic expansion remain far below pre-2011 levels, when headline GDP was growing above 5%. In the near term, our outlook on the economies of the Levant is tempered by the negative spillovers stemming from the crisis in Syria, while a degree of caution is warranted in North Africa due to policy vacuums and ‘event risks’ associated with upcoming elections. On the other hand, in several countries there are encouraging signs as a result of foreign aid commitments, IMF policy anchors, and tentative reform momentum, which should eventually benefit these economies as the regional and global backdrop improves. Greater convergence ahead The economic performance of MENA’s net oil importers has by no means been uniform of late. As we had been expecting, recently released data shows Morocco as the clear outperformer in 2013, with real GDP estimated to have expanded 4.8% y/y in Q4, bringing full-year growth to 4.4% (compared to our forecast of 4.2%). Morocco’s strong GDP reading was due in part to a favorable harvest which boosted the agricultural economy by 20.6% y/y, while growth in the nonagricultural economy came in at a more modest 2.1%. In contrast, Jordan and Tunisia have recorded unspectacular rates of expansion of between 2.5-3.5% since the start of 2013, while real GDP in Egypt has lagged behind and fallen to a two-year low of only 1.0% between July-September. Although we see scope for a significant degree of divergence in the economic trajectory of MENA’s oil importers over the long term, in the coming quarters we are forecasting a broad convergence in growth rates. In the first instance, last year’s outperformer – Morocco – should see headline GDP slow on the back of lower agricultural output and still anemic activity in the nonagricultural sector. At the same time, we are projecting an acceleration in investment and consumption in 2013’s underperformer – Egypt – as a result of higher business and consumer sentiment, and the government’s recently implemented stimulus measures. Some positive signs have already emerged in this regard, with the last two monthly PMI surveys for 2013 coming in above the 50 level which separates expansion from contraction. Duel deficits could improve Assuming global energy and food prices remain relatively stable this year, a slight improvement in the region’s current and fiscal accounts is a distinct possibility. After hitting a record 11.2% of GDP in 2013, our base case currently sees the weighted average budget deficit of MENA’s net oil importers beginning to narrow in 2014. Some progress has already been made in the case of Egypt and Morocco, with the former’s budget deficit narrowing 18.3% y/y

Regional Real GDP Growth

* Average weighted by nominal GDP Source: Emirates NBD Research

Purchasing Managers’ Indices

Source: Markit, Emirates NBD Research

Credit Growth

Source: Havers, Emirates NBD Research

0

1

2

3

4

5

6

7

2008 2009 2010 2011 2012 2013e 2014f 2015f

% y

/y

35

37

39

41

43

45

47

49

51

53

55

Apr-11 Sep-11 Feb-12 Jul-12 Dec-12 May-13 Oct-13

EgyptLebanon

-10

0

10

20

30

40

50

60

Jan-10 Aug-10 Mar-11 Oct-11 May-12 Dec-12 Jul-13

Egypt PrivateEgypt PublicJordan PrivateJordan Public

% y

/y

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in the first five months of this fiscal year (running July-June), which is largely due to a large reduction in the national subsidy bill. An improvement in the region’s underlying fiscal positions will be attributable to several factors, and in some cases include lower subsidy outlays (Egypt, Jordan), weaker CAPEX (Morocco), or increased foreign grants (every state). That said, even in those states which have signed IMF agreements, we do not believe governments will be willing to curtail spending too rapidly lest they risk undermining the near-term growth prospects. Although full GDP by expenditure breakdowns for 2013 are not yet available, we believe public spending is still playing a key role in propping up domestic demand across the region. A breakdown of recent credit trends in Egypt and Jordan would certainly seem to suggest that banks are significantly more willing to lend to the public sector. Moreover, given Egypt’s weighting in our regional average forecasts (accounting for 53%), the headline readings may be slightly misleading. Indeed, both Tunisia and Lebanon have witnessed sharp deteriorations in their public finances since the start of 2013, with the latter at risk of having posted its second consecutive annual primary budget deficit. With one of the highest government debt-to-GDP ratios in the world (approximately 134%), the increasingly fragile state of Lebanon’s fiscal position is likely to become more of a concern this year given the economy’s deteriorating outlook amidst elevated political risks. Policy vacuums could emerge With unemployment across the region still a major concern, there is a strong likelihood that governments may once again attempt to avoid pushing through with unpopular, yet necessary, reforms. This is particularly the case in Egypt and Tunisia where constitutional referendums, in addition to parliamentary and presidential elections, are set to take place in less than stable environments. In Tunisia, the former government of Prime Minister Ali Larayedh was quickly forced to suspend an increase in a vehicle tax after a strong public backlash, which could put the country’s ability to secure the next tranche in its IMF aid program in jeopardy. The threat of a prolonged policy vacuum is most acute in Lebanon however, which has been without a functioning government since the first half of 2013. With the possibility of holding elections in 2014 looking low in light of a sharp deterioration in the security environment, 2014 will be another year when major policy reforms are put on the backburner. In early January, it was announced that the government would delay for a third time the auction of licenses for offshore hydrocarbon exploration. Despite the massive benefits that could arise from tapping into these oil and gas resources, policy inertia looks set to prevent any substantive progress this year. Central banks as the last resort Against this backdrop of policy inertia, central banks will continue to carry the responsibility of maintaining economic stability and stimulating domestic demand. At the moment, monetary policy across the region is diverging, with Tunisia’s central bank recently forced to hike rates (to 4.50% from 4.00%) due to concerns over

Regional Budget Balances

Source: Emirates NBD Research *Weighted average the stability of the dinar, while Jordan and Egypt have maintained an easing bias in the face of weak economic activity. Going forward, although we cannot rule out the possibility that the Central Bank of Egypt will cut rates further (possibly by 25bps), we see significantly greater scope for further easing in Jordan, where inflation has recently fallen to a four-year low, and a recent influx in foreign aid has bolstered balance of payments stability.

-12

-10

-8

-6

-4

-2

02008 2009 2010 2011 2012 2013e 2014f 2015f

% o

f GD

P

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Bahrain

Growth expected to slow to 4.3% in 2014 Q3 2013 GDP growth was higher than expected, rising 2.1% q/q and 4.6% y/y. The oil sector has been the main driver of growth in 2013, expanding 10.4% y/y in the third quarter and by a cumulative 12% in the first three quarters of 2013. To a large extent, this has been due to the resumption of oil production that was disrupted due to technical issues in 2012. Non-oil growth has been more modest, at around 3% in the first three quarters of 2013, with hospitality and social/ personal services enjoying the fastest growth of 9.0% and 7.4% respectively over the period. The largest non-oil sectors of Bahrain’s economy are financial services (17% of GDP), government services (13% of GDP) and manufacturing (15% of GDP), and growth in these sectors was between 2-3% in Jan-Sep last year. Nevertheless, overall GDP growth in Q1-Q3 has averaged 4.7%, and we now expect full year growth of 4.8% for 2013. Due to the technical factors behind last year’s sharp expansion in the hydrocarbon sector, we do not expect the pace of growth in that sector is to be maintained in 2014. Consequently, we expect overall GDP growth to slow to 4.3% in 2014. Budget deficit set to widen Notwithstanding the substantial boost to oil revenues in 2013 on the back of higher production, and a relatively stable oil price, we anticipate the budget deficit widened to BHD 424mn or -3.4% of GDP last year from -2.0% of GDP in 2012. Expenditure growth was likely in the region of 11% y/y last year. The draft budget makes provision for a further 2.3% increase in expenditure in 2014, and we expect the deficit to widen further to BHD 660mn (-5.0% of GDP this year). Higher inflation reflects ‘normalisation’ of housing costs Inflation has averaged 3.2% in the year to November 2013, up from 2.8% in 2012. The main driver has been the continued normalisation of housing costs after the sharp declines in 2011, with housing and utility costs up by nearly 9% last year. Furniture and household equipment prices also rose sharply in 2013, with average inflation of 7.1% in this component of the index. We expect inflation to average 3.5% in 2014.

GDP Growth

Source: Haver Analytics, Emirates NBD Research

Budget balance

Source: Haver Analytics, Emirates NBD Research

Inflation

Source: Haver Analytics, Emirates NBD Research

4.3

1.9

3.4

4.8 4.3 4.3

0

1

2

3

4

5

6

2010 2011 2012 2013e 2014f 2015f

% y

/y

-4.8

-0.3

-2.0

-3.4

-5.0

-7.6 -8

-7

-6

-5

-4

-3

-2

-1

0

2010 2011 2012 2013e 2014f 2015f

% G

DP

-24

-20

-16

-12

-8

-4

0

4

8

12

16

Jan-12 May-12 Sep-12 Jan-13 May-13 Sep-13

% y

/y

Headline CPI Housing Food

Page 8: MENA Quarterly - Emirates NBD · economy among the oil importers, ... MENA Quarterly ... We expect Qatar and the UAE to be the fastest growing economies in

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Egypt Following three years of stagnation, we should finally see the Egyptian economy begin to gain momentum. There are positive signs in the recent data, with the latest purchasing managers’ surveys for December and November both coming in above the 50 level that separates expansion from contraction. Although presidential and parliamentary elections set for H1 will keep risk aversion somewhat elevated in the near term, our base case sees a more stable political backdrop emerging thereafter. Given a large output gap, this should help spark a revival in investment and consumption in the first instance. Having expanded only 1.0% y/y in real terms between July-September, we are penciling in GDP growth of 2.8% in FY2013/14 (fiscal year running July-June), before accelerating to a five-year high of 4.2% in FY2014/15. The key to Egypt’s improved outlook has been the inflow of financial assistance from the GCC, particularly at a time when private sector foreign capital inflows remain muted, and the prospects of an IMF agreement still appear remote. The USD15bn in aid commitments has bolstered balance of payments stability, and as a result, helped underpin a tentative revival in business and consumer confidence and improved market sentiment. On the latter point, since July 2013 the EGX30 equity index has rallied over 40%, while yields on 12 month treasury bills have dropped from 15.4% to 10.9% at the start of 2014. The key challenge this year will be attempting to transition away from a reliance on aid, and facilitating a revival in foreign investment inflows. Don’t underestimate the challenges Despite the improved outlook, the coming year will present authorities with a host of macroeconomic challenges which could derail a more pronounced recovery. In terms of balance of payments stability, even following the influx in GCC aid and the ongoing imposition of capital controls, FX reserves at the central bank have declined for four consecutive months through December. Although we are forecasting the Egyptian pound to remain stable in the EGP 6.90/USD area, fundamental downside pressures on the currency do not yet appear to have abated. In addition, with the budget deficit at nearly 14% of GDP in FY2012/13, the importance of addressing the deterioration in Egypt’s public finances has only increased in recent months. Every government since 2011 has been reluctant to make difficult decisions in terms of curtailing public spending, and it remains to be seen if any new administration will have the willingness to fundamentally reform the energy subsidy system or slow the expansion in the public sector payroll. With the central bank now appearing actively involved in deficit financing, Egypt can ill afford another year of policy drift.

PMI

Source: Markit/ HSBC, Emirates NBD Research

Monetary Trends

Source: Haver Analytics, Emirates NBD Research

FX Reserves & EGP

Source: Haver Analytics, Emirates NBD Research

36

38

40

42

44

46

48

50

52

Apr-11 Sep-11 Feb-12 Jul-12 Dec-12 May-13 Oct-13

Employment IndexPMI

0

5

10

15

20

25

30

35

Jan-10 Aug-10 Mar-11 Oct-11 May-12 Dec-12 Jul-13

Core CPIM1 Money Supply

% y

/y

0

5

10

15

20

25

30

35

40

5

5.5

6

6.5

7

Jan-09 Oct-09 Jul-10 Apr-11 Jan-12 Oct-12 Jul-13

FX Reserves, USDbnEGP/USD (lhs)

Page 9: MENA Quarterly - Emirates NBD · economy among the oil importers, ... MENA Quarterly ... We expect Qatar and the UAE to be the fastest growing economies in

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Jordan More than any other state across the region, Jordan’s primary macroeconomic troubles stem from factors well beyond the central government’s control. In particular, the sustained inflow of Syrian refugees into the country, in addition to frequent disruptions to natural gas supplies from Egypt, are making the task of addressing the economy’s duel deficits all the more difficult. According to our calculations, in percentage of GDP terms Jordan currently possesses the largest current account deficit of MENA’s oil importers (16%), and a budget deficit (9.0%) only surpassed by Egypt. Although household consumption is being supported by the population influx, fixed investment has stalled, while net exports are likely to drag heavily on headline GDP in the near term. We are forecasting growth of 3.2% y/y in 2014, up slightly from 3.0% in 2013. Not uniformly bearish This is not to say there is no cause for optimism. Although economic growth is likely to remain below trend over the coming quarters, Jordan’s current predicament has forced authorities to begin pushing ahead with reforms that should ultimately benefit the economy over the long term. Helped by a strong policy anchor in the form of an IMF Stand-By Arrangement, Amman has already started raising domestic energy prices in a bid to improve the financial health of the state energy firm NEPCO, which in 2013 received transfers from the government estimated at just under 8% of GDP. Moreover, the Central Bank of Jordan (CBJ) has been able to rebuild its buffer of FX reserves, as foreign aid inflows have helped to finance the massive current account deficit. This has drastically reduced fears of a change to the dinar’s peg to the dollar. Alongside de-dollarization within the domestic banking system, the CBJ has been able to loosen monetary policy by slashing rates 75bps since the start of H213. As core inflation in December fell to only 1.5% - its lowest level since November 2009 - we would not be surprised if further rate cuts materialize in the first half of 2014. In the event that Jordan experiences further negative shocks to its fiscal and external accounts (whether from Syria, Egypt or global energy prices), strong support from bilateral partners should help to mitigate near-term risks to the economy’s external position. In addition to foreign aid inflows from the Gulf and the aforementioned IMF SBA, Amman can also count on the support of the US, whose bond guarantees were crucial in helping the sovereign raise USSD1.2bn in October 2013 at a yield only 60bps above US treasuries of the same maturity.

Trade Figures

Source: Haver Analytics, Emirates NBD Research

Budget Deficit*

Source: Haver Analytics, Emirates NBD Research *Excluding grants, Jan-Oct

Syrian Refugees

Source: United Nations, Emirates NBD Research.

-40

-20

0

20

40

60

Jan-06 Jan-07 Jan-08 Jan-09 Jan-10 Jan-11 Jan-12

ExportsImports

% y

/y (3

mm

avg)

-1600

-1400

-1200

-1000

-800

-600

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02004 2005 2006 2007 2008 2009 2010 2011 2012 2013

JOD

mn

0

20000

40000

60000

80000

100000

120000

140000

160000

180000

0

100000

200000

300000

400000

500000

600000

700000

Dec-11 May-12 Oct-12 Mar-13 Aug-13

chg m/m (rhs)Refugees

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Kuwait

Hydrocarbon sector drives growth Kuwait boosted oil production by 5.3% to 2.94mn bpd on average in 2013, according to Bloomberg estimates, the biggest increase of all the GCC member states. This follows a 12.6% rise in oil output in 2012, again the highest in the region, and comes against a backdrop of flat oil production for the GCC as a whole in 2013. With non-oil growth hampered by policy inertia, the hydrocarbon sector is likely to remain the engine for growth in 2014. We expect overall GDP growth of 3.6% in 2013, easing to 3.0% in 2014. Budget and external surpluses remain substantial We estimate Kuwait’s budget will record a surplus of 20.4% of GDP in FY2013/2014 (April-March). While this is slightly lower than the 23.9% of GDP surplus in FY2012/13, it remains the highest in the region. Increased oil revenues have contributed to the substantial budget surpluses over the last few years, but they also partly reflect the government’s inability to fully execute its budget due to political deadlock and policy inertia. In FY2011/12 and FY2012/13, the government underspent by more than 10% of its budget. However, data for the first 6 months of the current fiscal year (ie April-September 2013) show that spending has increased by more than 50% compared with the same period in 2012, and we have assumed that this year’s budget will be fully executed. We anticipate that spending growth will slow in FY2013/14, as the authorities take on board IMF recommendations to curb current spending. Nevertheless, we forecast a narrowing of the budget surplus in FY2014/15 to just under 18% of GDP. Kuwait’s balance of payments position is also likely to remain strong in 2014, despite a forecast easing in the oil price this year. We expect the current account surplus to narrow slightly to 40.5% of GDP in 2014 from an estimated 41.9% of GDP in 2013. Private sector credit growth has accelerated Both money supply and private credit growth accelerated in 2013, despite the political uncertainty. M3 growth reached 11.3% y/y in November, up from 7.8% at the end of 2012. We expect broad money growth to ease slightly to 9.1% by December 2013. Private sector credit growth has also picked up steadily during the course of last year, reaching 6.4% in November. We think it could end-2013 at 7.2%. In contrast, government borrowing from domestic banks has continued to contract on an annual basis, reaching -14.6% y/y in November 2013.

GDP Growth

Source: Haver Analytics, IMF, Emirates NBD Research

Budget and current account balance

Source: Haver Analytics, IMF, Emirates NBD Research

Money and credit growth

Source: Haver Analytics, Emirates NBD Research

0

5

10

15

20

2011 2012f 2013f 2014f 2015f

% y

/y

Real GDP growth

Hydrocarbon sector

Non oil sector

0

10

20

30

40

50

60

70

80

90

2011 2012f 2013f 2014f 2015f

% G

DP

Budget balance Current account balance

0

2

4

6

8

10

12

Jan-12 May-12 Sep-12 Jan-13 May-13 Sep-13

% y

/y

M2 Private sector credit

Page 11: MENA Quarterly - Emirates NBD · economy among the oil importers, ... MENA Quarterly ... We expect Qatar and the UAE to be the fastest growing economies in

Page 11

Lebanon

Downgrade to 2013 growth forecast Since our last quarterly report, the economic and political backdrop in Lebanon has deteriorated, and we have revised many of our forecasts accordingly. Although a significant amount of volatility was already incorporated in our base case projections, the security situation (particularly in Beirut) appears to have deteriorated further. As a result, we have revised down our 2014 real GDP growth forecast to 2.2%, from 3.4% previously. At the same time, in late December ratings agency Fitch cited heightened political risk, worsening public debt dynamics, and weak growth prospects in its decision to downgrade the outlook on Lebanon’s sovereign credit rating (B) from stable to negative. While the economy is likely to underperform its regional peers in 2014, we concede that available leading indicator data through end-2013 has been mixed. December’s purchasing managers’ index rose to 49.0 from 45.1 in November, with the new orders sub-component bouncing to a seven-month high of 47.4. Multi-month highs were also recorded in passenger arrivals, cement deliveries, and the economic coincident indicator - which expanded 4.6% y/y in October (3mmavg). On the other hand, as of October, customs receipts had dropped in y/y terms for eight consecutive months, while the value of goods exports contracted -25.9% y/y (3mmavg) in November, which was the fastest pace of decline in our time series that dates back to 2001. From these figures, it appears that although the economy is stabilizing, this is taking place at a very low base. Policy vacuum and debt dynamics The deterioration in Lebanon’s public finances in recent months is potentially of greater concern, in our view. A drop in tax receipts has seen revenues contract by an average 3.3% in the first ten months of 2013, while expenditure growth remained relatively steady at 7.8%. According to our calculations, the country is set to post its second consecutive full-year primary budget deficit, which would risk reversing the progress that has been made since 2006 on reducing the country’s public debt load. Indeed, we project estimate public debt (as a share of GDP) to have risen to 142% in 2013, compared to 133% in 2011. A key factor undermining Lebanon’s outlook is the ongoing policy vacuum, which has left the country without a functioning government since H1 2013. Not only does this undermine the near-term growth outlook, but it will also have longer-term implications. Indeed, in early January it was announced that authorities would delay for a third time the auction of licenses for offshore hydrocarbon exploration. Despite the massive benefits to external and fiscal accounts that could arise from tapping into these resources, policy inertia once again looks set to prevent any substantive progress this year.

PMI

Source: Markit, Emirates NBD Research

Credit Growth

Source: Haver Analytics, Emirates NBD Research

Public Debt

Source: Haver Analytics, Emirates NBD Research

37

39

41

43

45

47

49

51

53

55

May-13 Jul-13 Sep-13 Nov-13

PMINew Orders

-15

-10

-5

0

5

10

15

20

25

30

Jan-07 Jan-08 Jan-09 Jan-10 Jan-11 Jan-12 Jan-13

Claims on Private SectorClaims on Public Sector

% y

/y

0

20

40

60

80

100

120

140

160

180

200

0

20000

40000

60000

80000

100000

120000

140000

2006 2008 2010 2012 2014f

LBPbn (lhs)% of GDP

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Page 12

Morocco Recently released data shows the Moroccan economy as the clear outperformer among MENA’s net oil importers in 2013, with real GDP estimated to have expanded 4.8% y/y in Q4, which would bring full-year growth to 4.4% (our initial projection saw growth of 4.2%). That said, a look beneath the GDP figure suggests underlying business activity may not be as strong as the headline print suggests, as growth last year was supported by an exceptionally strong harvest which boosted the agricultural economy by 20.6% y/y. At the same time, the non-agricultural economy expanded by a more modest 2.1% - a figure broadly in line with the pace of growth being recorded in MENA’s other oil importers. Growth set to slow Our base case for 2014 sees real GDP growth slowing to 3.1% y/y, as negative base effects from last year’s agricultural harvest are likely to weigh on the pace of headline GDP expansion. Looking at currently available data, there is little to suggest that momentum within the non-agricultural economy will soon pick up. Fixed investment looks particularly weak at the moment, with the country’s cement industry issuing a statement in early January that sales dropped 6.3% y/y in 2013 (following a fall of 1.6% in 2012) on the back of a slowdown in housing projects. In addition, latest figures for tourism and remittance receipts are less than inspiring, with the former contracting 4.9% y/y in November (3mmavg), while the latter posted growth of only 1.7%. As tourism and remittance receipts account for roughly 9% and 7% of GDP respectively, this data would suggest household consumption may remain relatively anemic in 2014. In both cases, improving conditions in the Eurozone could provide some respite. However, as we are projecting full-year growth of only 0.5% in the common currency bloc, the external environment cannot be relied on to boost economic activity by any meaningful extent. External financing gap not yet a concern In early January, Morocco’s finance ministry stated the current account gap had narrowed to 7.7% of GDP in 2013, from 9.7% in 2012. Despite the improvement, financial account inflows in Q312 and Q2 were insufficient to cover the current account deficit, which raises questions over the stability of the economy’s external position. Nevertheless, we do not believe Morocco will experience significant difficulty meeting its external financing requirements in 2014. Not only is the country a beneficiary of stable foreign aid inflows (USD276mn from the AMF, USD1.2bn from Qatar and USD4bn from the World Bank over the next four years), but Rabat can also count on its USD6.2bn Precautionary Liquidity Line from the IMF, which the government has not yet been tapped.

GDP Growth

Source: Haver Analytics, Emirates NBD Research

Tourism & Remittance Receipts

Source: Haver Analytics, Emirates NBD Research

Balance of Payments

Source: Haver Analytics, Emirates NBD Research

-15

-10

-5

0

5

10

15

20

25

30

35

Q108 Q408 Q309 Q210 Q111 Q411 Q312 Q213

AgricultureNon-agriculture

% y

/y

-30

-25

-20

-15

-10

-5

0

5

10

15

20

25

Jan-08 Dec-08 Nov-09 Oct-10 Sep-11 Aug-12 Jul-13

TourismRemittances

% y

/y (3

mm

avg)

-40000

-30000

-20000

-10000

0

10000

20000

30000

Q108 Q408 Q309 Q210 Q111 Q411 Q312 Q213

Financial AccountCurrent Account

MAD

mn

Page 13: MENA Quarterly - Emirates NBD · economy among the oil importers, ... MENA Quarterly ... We expect Qatar and the UAE to be the fastest growing economies in

Page 13

Oman

Growth set to slow in 2014 Recently released revised GDP data put real growth at 5.7% in 2012, up from 5.1% previously. Consequently, we have revised down our estimate for 2013 growth slightly to 4.7% from 5.0% (off the higher base). We still expect the main driver of growth last year to have been the hydrocarbon sector, with crude oil production up 3.8% in the year-to-November according to Energy Intelligence Group estimates. We expect real growth to slow to 4.0% in 2014, as we think it unlikely that oil production will increase at a similar pace this year. As the hydrocarbon sector still accounts for more than 44% of real GDP, a slowdown in oil expansion to 2.5% in 2014 would have a significant impact on the headline growth rate. Non-oil growth is likely to remain underpinned by government spending next year. Indeed, public administration and defense account for more than 8% of Oman’s real GDP, and growth in this component has been strong since 2011, as the government has increased both current and development spending. Budget to move into deficit in 2014 The official budget for 2013 makes provision for OMR 12.9bn in total expenditure, which is in line with our estimates for budget revenue last year, and suggests a balanced budget. Data for Q1-Q3 show that the budget recorded a surplus of around OMR 0.3bn, compared with OMR 22.9bn in the same period the year before, as expenditure was 26% higher y/y. If the government expenditure is as high in Q4 as has been the case in previous years, the budget could show a deficit already in 2013. For 2014, the authorities have drafted a budget with OMR 13.5bn in spending, up almost 4% on our 2013 estimate. Current expenditure (mainly wages and salaries) accounts for 65% of the total budget. Subsidies and exemptions account for a further 10% of the budget. Investment spending will continue to focus on development of oil and gas fields as well and other infrastructure projects. Official revenue projections are typically conservative at OMR 11.7bn, based on an oil price of USD 85pb. We forecast revenues of OMR 13.0bn using the Bloomberg consensus oil price forecast of USD 100pb and higher oil production estimates. Consequently, we project a budget deficit of around OMR 0.5bn (-1.6% of GDP) this year, substantially lower than the official budget’s projected OMR 1.8bn deficit. The government has indicated the deficit will be financed by drawing on accumulated surpluses and reserves, as well as some foreign and domestic borrowing if required.

Oil Production

Source: EIG via Bloomberg, Emirates NBD Research

GDP growth

Source: Haver Analytics, Emirates NBD Research

Budget balance

Source: Haver Analytics, Emirates NBD Research

840

860

880

900

920

940

960

980

1000

Jan-12 May-12 Sep-12 Jan-13 May-13 Sep-13

Th. B

pd

4.8 4.1

5.7

4.7 4.0

3.6

0

2

4

6

8

2010 2011 2012 2013e 2014f 2015

% y

/y

4.9

6.3

0.9

0.0

-1.6 -1.0

-5

0

5

10

2010 2011 2012 2013e 2014f 2015

% G

DP

Page 14: MENA Quarterly - Emirates NBD · economy among the oil importers, ... MENA Quarterly ... We expect Qatar and the UAE to be the fastest growing economies in

Page 14

Qatar

2013 growth forecast revised up to 6.0% Real GDP growth accelerated to 4.3% q/q and 6.2% y/y in Q3 2013, from 0.3% q/q and 5.7% y/y in Q2 2013. The third quarter is typically a good one for ‘Transport & communication’, ‘trade & hospitality’ and utilities, due to summer seasonal effects, and 2013 was no different with these sectors all recording double-digit growth q/q. Transport, trade and hospitality also expanded strongly on an annual basis in Q3 however, as did ‘building & construction’, ‘financial services’ and ‘government services’. The data supports our view that government spending on infrastructure and public services has replaced hydrocarbons as the main engine of growth in Qatar, and this trend is likely to remain the case in 2014 in our view. Given the stronger than expected growth in Q1-Q3 2013, we have revised up our forecast for full year 2013 GDP growth in Qatar to 6.0% from 5.2% previously. We retain our 2014 GDP growth forecast at 5.2%. Money supply growth slowed in 2013 Money supply growth slowed sharply over the summer last year, and has remained around 15% y/y in H2 2013. The main drivers appears to have been declining demand deposits as well declining FX deposits for most of the second half of last year. However, we expect M2 growth to accelerate to 18% y/y in December 2013, due to base effects. Government deposits increased sharply from August through October however, and this is reflected in significantly higher M3 growth through H2 2013. We expect broad money growth (excluding government deposits) to reach 15.0% y/y by December 2014. Private sector credit growth was relatively steady for most of last year, ranging between 13-15%. Public sector borrowing slowed sharply during the course of last year, off the very high base of 2012. We expect private sector credit growth to remain broadly stable in 2014, reaching 15.5% y/y by the end of this year. Housing costs drive inflation Inflation accelerated to 3.2% in the year-to-November 2013, up from an average 1.9% in 2012. Higher rents and utilities were the main driver, with housing costs in the CPI rising nearly 6% on average last year. Inflation in the ‘entertainment and recreation’ component accelerated to 7.5% last year, up from 6.0% in 2012, likely reflecting stronger consumer demand. Imported inflation was relatively muted in Qatar, as elsewhere across the GCC. We expect inflation to accelerate to 4.0% on average this year, again fuelled mainly by housing and services.

Qatar’s LNG Prices Remain High

Source: Haver Analytics, IMF, Emirates NBD Research

Money supply growth

Source: Haver Analytics, Emirates NBD Research

Inflation

Source: Haver Analytics, Emirates NBD Research

16.7

13.0

6.2 6.0 5.2

6.1

0

3

6

9

12

15

18

2010 2011 2012 2013e 2014f 2015f

% y

/y

0

10

20

30

40

50

Dec-12 Mar-13 Jun-13 Sep-13

% y

/y

M2

M3 (incl govt deposits)

-8

-6

-4

-2

0

2

4

6

8

Jan-12 May-12 Sep-12 Jan-13 May-13 Sep-13

% y

/y

Headline CPI

Food

Housing

Page 15: MENA Quarterly - Emirates NBD · economy among the oil importers, ... MENA Quarterly ... We expect Qatar and the UAE to be the fastest growing economies in

Page 15

Saudi Arabia

2013 growth estimated at 3.8% Official estimates released in the 2014 budget statement put 2013 growth at 3.8%, largely in line with our 3.9% forecast. We had revised our growth forecast for Saudi Arabia down during the course of last year, due both to a decline in oil production and weaker than expected non-oil growth. Official estimates show the hydrocarbon sector contracting -0.6% last year, but Bloomberg estimates show oil production declined by around -2.5% in 2013, suggesting a downward revision to this component is possible. In the non-oil sector, construction (8.1% y/y); transport, storage & communication (7.2% y/y); trade & hospitality (6.2% y/y) and financial services (4.9% y/y) enjoyed strong growth last year. Expenditure growth set to slow in 2014 Preliminary estimates put government spending in 2013 at SAR 925bn, nearly 13% higher than the official budget but in line with our forecast. Government spending has been a key driver of real growth in Saudi Arabia since the financial crisis, and especially post-2011 after the government announced a raft of new spending initiatives in the wake of the Arab Spring. Over the last decade, expenditure has grown by an average 14.3% y/y, but this slowed to less than 6% y/y in 2013 according to preliminary estimates. We expect this trend to continue this year, and we forecast just a 3% rise in budget spending in 2014, taking it to SAR 953bn; 13% higher than the official budget. Thus, while public sector expenditure remains an important driver of growth, momentum from this sector is slowing. Budget revenue is also projected to decline in 2014, as the oil price is expected to average USD 100/bbl down from USD 105/bbl in 2014, and oil production is assumed to be stable. Consequently, we expect Saudi Arabia’s budget surplus to narrow to 4.9% of GDP from 7.4% in 2013. We also project a slight increase in the break-even oil price for Saudi Arabia to USD 86/bbl. Non-oil sectors to be the engine for growth in 2014 Growth in the non-oil sectors is likely to be underpinned by still substantial public sector spending, as well as improved global and regional growth prospects. Indeed, PMI data in the fourth quarter showed a rebound in the private non-oil sectors of the economy, after a sluggish summer. Private sector credit growth remains robust at around 14% y/y, and employment in the private sector is increasing. We expect real GDP growth to accelerate slightly to 4.2% this year, assuming stable oil production. Inflation likely to rise in 2014 Inflation in 2013 averaged 3.5%. PMI data suggests that inflationary pressures are building, as the rate of growth in input prices is exceeding that of output prices. However, firms raised output prices at the fastest pace in 10 months in December, and we expect inflation to accelerate to 4.0% on average in 2014.

Oil production and price

Source: Bloomberg, Emirates NBD Research

GDP and budget spending growth

Source: Haver Analytics, Emirates NBD Research

PMI – input and output price indices

Source: Markit/ HSBC, Emirates NBD Research

0

20

40

60

80

100

120

140

8.4

8.9

9.4

9.9

10.4

Jan-12 May-12 Sep-12 Jan-13 May-13 Sep-13

US

D p

er b

arre

l

mn

bpd

Oil production (lhs) Oil price (rhs)

0

2

4

6

8

10

12

14

16

2010 2011 2012f 2013f 2014f 2015f

Real GDP growth (% y/y)

Budget balance (% GDP)

45

50

55

60

65

Jan-12 May-12 Sep-12 Jan-13 May-13 Sep-13

Output Prices Index Input Prices Index

Page 16: MENA Quarterly - Emirates NBD · economy among the oil importers, ... MENA Quarterly ... We expect Qatar and the UAE to be the fastest growing economies in

Page 16

Tunisia

Stability around the corner? Three years since the start of its political transition, underlying stability in Tunisia is still proving elusive. After months of negotiations throughout H213, an agreement to name former Industry Minister Mehdi Jomaa as interim prime minister was only announced in late December. Jomaa took office in early January and is now tasked with forming a technocratic government, which will rule until parliamentary elections are held later this year. From our standpoint, the key risk is that these elections will result in a similar outcome to that seen in 2011, and resolve none of the fundamental issues that have pushed Tunisia into its current predicament. Latest data shows the Tunisian economy posted growth of 2.7% y/y in real terms in Q3 2013, down from 3.4% in Q2. The manufacturing sector appeared particularly weak in the second half of 2013, having expanded only 0.1% y/y in the third quarter, while the trade sector, in contrast, grew 3.1% - its fastest pace since Q2 2010. Since 2011 the economy has not recorded a single quarter’s growth exceeding 4.0, except for Q1 2012, when GDP growth was boosted by low base effects. Looking ahead, although we have penciled in growth of 3.4% for 2014 (compared to our estimate of 3.1% for 2013), this could prove overly optimistic. Indeed, as investment and exports have remained anemic since early 2011, one of the key drivers of economic activity has been the public sector. Going forward however, we would not be surprised to see the IMF put greater pressure on Tunis to curtail government spending as part of its ongoing Stand-By Arrangement (SBA). In Q3 the public administration sector expanded 5.2% y/y, which was the slowest pace since the fourth quarter of 2010. With the central bank having also recently hiked interest rates by 50bps (to 4.50%), there is certainly a risk that fiscal and monetary tightening could result in slower growth this year. A difficult environment for austerity We estimate Tunisia’s budget deficit at 7.7% of GDP in 2013, up sharply on the 5.5% and 3.5% shortfalls posted in 2012 and 2011 respectively. Efforts at reining in this fiscal shortfall may prove difficult at a time of weak growth and still elevated unemployment (the latter stood at 15.7% as of Q3 2013). Indeed, before leaving office, the former government of Prime Minister Ali Larayedh quickly suspended an increase in a vehicle tax after a strong backlash led to public protests. Shortly thereafter, the government said it would also suspend energy price hikes, which had initially been planned for the 2014 budget.

GDP Growth

Source: Haver Analytics, Emirates NBD Research

Exchange Rate

Source: Bloomberg, Emirates NBD Research

Monetary Policy

Source: Haver Analytics, Emirates NBD Research

-10

-5

0

5

10

15

Q108 Q408 Q309 Q210 Q111 Q411 Q312 Q213

GDPManufacturingTradePublic Administration

% y

/y

1.9

1.95

2

2.05

2.1

2.15

2.2

2.25

2.3

Jan-11 Jul-11 Jan-12 Jul-12 Jan-13 Jul-13 Jan-14

EU

RTN

D

0

1

2

3

4

5

6

7

Jan-06 Jan-07 Jan-08 Jan-09 Jan-10 Jan-11 Jan-12 Jan-13

Policy Rate, %CPI, y/y

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Page 17

UAE

Expect another year of strong growth The UAE economy enjoyed robust growth last year, as oil production increased and the continued recovery in domestic and regional demand boosted the non-oil sectors. Oil production rose by an estimated 4.7% in 2013 (Bloomberg), well above our forecasts at the start of the year, and in contrast to Saudi Arabia which saw oil production ease in 2013. As oil production accounts for around one-third of GDP, this provided a substantial boost to overall growth. The non-oil sector has also enjoyed strong expansion, particularly in Dubai where data shows that manufacturing, hospitality and trade grew robustly in the first half of last year. We expect these trends to have continued in the second half of the year. Indeed, the purchasing managers’ surveys suggest that the non-oil sectors in the UAE expanded at a record pace in the fourth quarter, driven mainly by domestic demand rather than exports. As fiscal policy in the UAE has been relatively contained compared with the substantial fiscal stimulus in Saudi Arabia and Qatar over the last couple of years, this suggests that the private sector has been a key driver of the UAE’s growth in 2013. The acceleration in private sector credit growth, strong retail sales and continued recovery in the real estate sector provide further evidence of this. Overall, we conservatively estimate the UAE’s economy expanded by 4.6% in real terms last year. Looking ahead, we expect growth at a similar pace this year. The oil sector is unlikely to contribute significantly to the UAE’s growth in 2014, as substantial increases to crude output in 2011-2013 are now in the base, and supply from Iran, Iraq and Libya is expected to rise this year. We have assumed the UAE’s oil production will increase by around 2% this year. We expect growth to come largely from the non-oil sectors, which are likely to benefit from an improving global growth environment as well as strong domestic and regional fundamentals. These include supportive fiscal policy in the rest of the GCC, which will continue to spillover into the UAE through trade and tourism; as well as increased consumer and investor confidence in the UAE’s medium and long-term growth prospects. Private sector credit growth picks up After remaining subdued since the financial crisis, private sector credit growth finally accelerated during the course of 2013, with bank loan growth accelerating to 6.9% y/y in August, before easing to 4.9% y/y in October (the latest available data). While private credit growth remains well below the double-digit credit growth in Saudi Arabia and Qatar, the pick-up in lending is another indicator that the UAE’s private sector is rebounding. We expect credit growth to continue to rise slowly and steadily through 2014, as consumption and investment recover, and as banks look to growth their balance sheets.

Oil Production

Source: Bloomberg, Emirates NBD Research

GDP Growth

Source: Haver Analytics, Emirates NBD Research

Purchasing Managers’ Index

Source: HSBC/ Markit, Emirates NBD Research

0

20

40

60

80

100

120

140

2.0

2.2

2.4

2.6

2.8

3.0

3.2

3.4

Jan-12 May-12 Sep-12 Jan-13 May-13 Sep-13

US

D p

er b

arre

l

mn

bpd

Oil production (lhs) Oil price (rhs)

1.7

3.9 4.4

4.6 4.5 4.5

0

2

4

6

2010 2011 2012 2013e 2014f 2015f

% y

/y

50

52

54

56

58

60

Jan-12 May-12 Sep-12 Jan-13 May-13 Sep-13

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Page 18

Liquidity conditions in the UAE banking system have also improved this year, with M2 growth accelerating to 18.8% y/y in October 2013, the fastest pace of growth since December 2008. The main driver appears to have been a sharp rise in quasi money (FX and long-term dirham deposits), although demand deposits also showed strong annual growth in the first ten months of last year. In a statement, the central bank attributed the growth in bank deposits this year to increased residents’ deposits, suggesting that the funds are relatively ‘sticky’. The growth in deposits and improved liquidity in the banking system through 2013 is reflected in the easing in interbank rates, with 3m EIBOR declining by nearly 50bp during the course of last year. With the Fed having already started ‘tapering’, the scope for further tightening in the EIBOR rate is limited in our view. Inflation likely to rise in 2014 Inflation was lower than we had anticipated at the start of 2013, averaging just 1.1% last year. Food and imported inflation was relatively low, and although the housing sub-index bottomed, official measures of housing inflation were still relatively low. As we have noted before, the difference between the official CPI measure of housing costs and the ‘market prices’ for residential real estate is due to different survey methodologies. Nevertheless, the inflation outlook for 2014 is less benign than it has been for several years as we do expect higher housing costs to gradually feed through to the official inflation indices. The PMI surveys also indicate a build-up of inflationary pressure, which could put upward pressure on CPI this year. Input prices have been rising much faster than output prices since the record began (August 2009), as firms were reluctant to pass on higher input costs post-crisis, when consumer demand was relatively muted and there was spare capacity in the UAE economy. However, as the economy (and consumer demand) recovers, firms should gain pricing power and be able to pass on rising production costs to consumers. We thus expect inflation to average 3.0% this year, up from just over 1% in 2013.

Money supply and credit growth

Source: Haver Analytics, Emirates NBD Research

Consolidated budget balance

Source: IMF, Emirates NBD Research

Inflation

Source: Haver Analytics, Emirates NBD Research

-5

0

5

10

15

20

25

30

35

40

Jan-12 Apr-12 Jul-12 Oct-12 Jan-13 Apr-13 Jul-13

% y

/y

M2Private sector creditPublic sector credit

-1.8

4.1

8.6 8.6

6.8 6.2

-4

-2

0

2

4

6

8

10

2010 2011 2012 2013e 2014f 2015f

% y

/y

-6

-3

0

3

6

9

12

Jan-12 May-12 Sep-12 Jan-13 May-13 Sep-13

% y

/y

CPI Food Housing

Page 19: MENA Quarterly - Emirates NBD · economy among the oil importers, ... MENA Quarterly ... We expect Qatar and the UAE to be the fastest growing economies in

Page 19

UAE - Dubai

Expo 2020 win capped a strong 2013 Winning the right to host the world expo in 2020 has crowned a strong 2013 for Dubai. GDP growth has been better than expected – we conservatively estimate 2013 growth at 4.5% - the real estate sector has enjoyed a strong recovery and the Dubai Financial Market was the second best performing equity index globally in 2013. Hosting the Expo will undoubtedly provide a boost to medium term growth and help to underpin Dubai’s broader economic strategy of growing its tourism and hospitality sector over the next few years. We estimate the event could boost our baseline 4% medium term growth forecast for Dubai by half a percentage point per year over 2015-2017, rising to one percentage point per year over 2018-2020. More of the same in 2014? We expect growth to accelerate to 4.7% this year as global growth prospects improve, and as the expected easing of sanctions against Iran boosts Dubai’s trade and export sectors. Manufacturing, hospitality, transport and trade sectors are again expected to be the engine for growth. The construction sector is likely to contribute in a meaningful way to Dubai’s growth in 2014, for the first time since 2009, as recently launched residential and development projects get underway. Residential real estate prices continued to rise across all segments of the market in December 2013, but the pace of price growth has slowed in Q4 2013. The sharp rise in residential real estate prices over the last couple of years, together with the prospect of further investment ahead of the Expo, has already resulted in several new projects being announced and/ or launched during 2013. The outlook for residential real estate price growth remains positive, although analysts expect the pace of price growth to moderate after 2013’s strong gains. Factors which contributed to price recovery in 2013, including population growth on the back of the broader economic recovery, Dubai’s status as a regional ‘safe-haven’ and the fixed exchange rate remain in play. Tourism and hospitality still going strong The average occupancy rate for Dubai hotels in the year-to-November rose to 79.6% in 2013, from 76.8% in 2012, according to data from STR Global. Hotels were able to increase prices by more than 10% on average last year, despite a 6% rise in the supply of hotel rooms in Dubai. Growth in tourism has been helped by the introduction of new airline routes to Dubai, with passenger traffic up almost 15% y/y in the year-to-November 2013. The sector will likely receive a further boost in 2014 from the recent opening of the new Makhtoum International Airport passenger terminal.

Dubai GDP growth forecasts

Source: Dubai Airports, Emirates NBD Research

Real estate price growth

Source: Cluttons via Bloomberg, Emirates NBD Research

Hotel RevPAR growth remains strong

Source: STR Global, Emirates NBD Research

0

1

2

3

4

5

6

2011 2012 2013f 2014f 2015f

%

-40

-20

0

20

40

60

80

100

Jan-10 Jan-11 Jan-12 Jan-13

% y

/y

Mid-range villas

Mid-range apartments

Low-end apartments

-20

0

20

40

60

-40

0

40

80

120

Jan-12 Jul-12 Jan-13 Jul-13

% y

/y

%

Growth in RevPAR (rhs)

Occupancy rate (lhs)

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Key Economic Forecasts: Bahrain

National Income 2011 2012 2013f 2014f 2015f

Nominal GDP (BHD bn) 11.0 11.4 12.5 13.2 14.0

Nominal GDP (USD bn) 29.2 30.4 33.2 35.0 37.2

GDP per capita (USD) 24400 24905 26739 27634 28730

Real GDP Growth (% y/y) 1.9 3.4 4.8 4.3 4.3

Monetary Indicators (% y/y)

M2 5.2 4.4 11.0 7.8 7.8

Private sector credit 15.0 6.2 8.5 8.0 8.5

CPI (average) -0.4 2.8 3.2 3.5 3.5

External Accounts (USD bn)

Exports 19.7 19.8 21.0 20.3 20.3

Of which: hydrocarbons 15.5 15.2 16.2 15.3 15.0

Imports 12.1 13.2 12.5 12.3 12.5

Trade balance 7.5 6.5 8.5 8.0 7.9

% GDP 25.9 21.5 25.6 22.7 21.2

Current account balance 3.2 2.2 3.8 3.3 2.9

% GDP 11.1 7.3 11.4 9.3 7.7

Fiscal Indicators (% GDP)

Budget balance -0.3 -2.0 -3.4 -5.0 -7.6

Revenue 25.7 26.6 25.6 23.1 19.7

Expenditure 26.0 28.6 29.0 28.1 27.3

Source: Haver Analytics, Emirates NBD Research

Page 21: MENA Quarterly - Emirates NBD · economy among the oil importers, ... MENA Quarterly ... We expect Qatar and the UAE to be the fastest growing economies in

Page 21

Key Economic Forecasts: Egypt

National Income 2011 2012 2013f 2014f 2015f

Nominal GDP (EGP bn) 1371.1 1575.5 1753.3 1978.2 2261.3

Nominal GDP (USD bn) 235.6 262.3 268.1 282.6 330.1

GDP per capita (USD) 2854 3124 3140 3256 3760

Real GDP Growth (% y/y) 2.5 3.3 2.1 2.8 4.2

Monetary Indicators (% y/y)

M2 10.0 8.4 17.0 12.0 10.0

CPI (average) 10.1 7.2 10.0 11.0 10.0

External Accounts (USD bn)

Exports 27.0 25.1 26.0 27.1 28.1

Imports 54.1 59.2 57.5 56.7 56.9

Trade Balance -27.1 -34.1 -31.5 -29.6 -28.8

% of GDP -16.7 -21.0 -19.4 -18.2 -17.7

Current Account Balance -6.1 -10.1 -5.6 -2.1 -1.0

% of GDP -3.7 -6.2 -3.4 -1.3 -0.6

Reserves 26.6 15.5 14.9 16.4 19.4

Public Finances

Revenue (EGP bn) 265.3 303.6 350.3 385.1 427.2

Expenditure (EGP bn) 401.9 471.0 588.2 579.0 574.8

Balance* -134.5 -166.7 -239.7 -193.4 -147.1

% of GDP -11.1 -12.2 -13. 7 -11.1 -8.4

Central Government Debt (EGP bn) 808.1 990.5 1261.1 1450.3 1450.3

% of GDP 58.9 62.9 72.3 75.8 76.8

Source: Haver Analytics, Emirates NBD Research Note: * denotes fiscal year (FY2012/13 refers to July 2012-June 2013)

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Key Economic Forecasts: Jordan

National Income 2011 2012 2013f 2014f 2015f

Nominal GDP (JOD bn) 18.0 19.3 20.9 22.5 24.8

Nominal GDP (USD bn) 25.3 27.2 29.5 31.6 34.9

GDP per capita (USD) 4002 4209 4487 4734 5121

Real GDP Growth (% y/y) 2.6 2.7 3.0 3.2 4.0

Monetary Indicators (% y/y)

M2 11.0 -0.8 5.0 6.0 8.0

CPI (average) 4.4 4.8 5.5 4.1 6.2

External Accounts (USD bn)

Exports 8.0 7.9 8.8 9.7 10.5

Imports 16.8 18.4 19.4 19.9 20.7

Trade Balance -8.8 -10.5 -10.5 -10.2 -10.2

% of GDP -34.8 -38.8 -35.7 -32.3 -29.4

Current Account Balance -3.5 -5.4 -4.7 -3.7 -3.1

% of GDP -13.7 -19.7 -16.0 -11.8 -9.0

Reserves 12.1 8.8 9.7 10.7 11.5

Public Finances

Revenue (JOD bn) 5.4 5.1 5.5 6.1 6.8

Expenditure (JOD bn) 6.8 6.9 7.4 8.1 8.9

Balance -1.4 -1.8 -1.9 -2.0 -2.1

% of GDP -7.7 -9.5 -9.0 -8.8 -8.4

Central Government Debt (JOD bn) 14.1 16.8 20.2 23.2 23.2

% of GDP 78.3 87.2 95.1 99.3 96.1

Source: Haver Analytics, Emirates NBD Research

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Key Economic Forecasts: Kuwait

National Income 2011 2012 2013f 2014f 2015f

Nominal GDP (KWD bn) 46.0 53.0 52.4 53.7 56.2

Nominal GDP (USD bn) 166.4 189.3 184.5 187.2 194.0

GDP per capita (USD) 45012 50114 47774 47437 48094

Real GDP Growth (% y/y) 10.1 8.0 3.6 3.0 3.0

Hydrocarbon 15.4 11.6 5.0 2.5 2.0

Non-hydrocarbon 4.6 3.8 2.0 3.6 4.3

Monetary Indicators (% y/y)

M3 8.2 7.8 9.1 7.1 8.3

Private sector credit 2.6 2.8 7.2 7.0 8.0

CPI (average) 4.9 3.2 3.0 3.5 4.0

External Accounts (USD bn)

Exports 102.8 119.2 120.2 116.8 117.7

Of which: hydrocarbons 96.6 112.8 113.5 109.8 110.4

Imports 22.0 22.4 24.0 25.9 28.0

Trade balance 80.7 96.7 96.2 90.9 89.7

% GDP 48.5 51.1 52.1 48.6 46.2

Current account balance 67.1 79.2 77.3 75.8 75.3

% GDP 40.3 41.8 41.9 40.5 38.8

Fiscal Indicators (% GDP)

Budget balance 28.8 23.9 20.4 17.7 16.5

Revenue 65.7 60.3 61.4 60.0 59.2

Expenditure 37.0 36.4 41.1 42.3 42.7

Source: Haver Analytics, IMF, Emirates NBD Research

Page 24: MENA Quarterly - Emirates NBD · economy among the oil importers, ... MENA Quarterly ... We expect Qatar and the UAE to be the fastest growing economies in

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Key Economic Forecasts: Lebanon

National Income 2011 2012 2013 2014f 2015f

Nominal GDP (LBP bn) 60442 64054 69964 76691 83986

Nominal GDP (USD bn) 40.1 42.6 46.5 51.2 56.5

GDP per capita (USD) 9423 9923 10760 11758 12875

Real GDP Growth (% y/y) 1.6 1.5 1.2 2.2 3.6

Monetary Indicators (% y/y)

M2 -1.4 10.9 5.0 8.0 9.0

CPI (average) 5.0 6.6 2.0 4.0 6.0

External Accounts (USD bn)

Exports 6.0 6.2 6.5 7.1 8.1

Imports 19.9 20.8 22.3 24.3 26.5

Trade Balance -13.9 -14.6 -15.8 -17.2 -18.4

% of GDP -34.6 -34.3 -34.0 -33.5 -32.6

Current Account Balance -4.9 -1.7 -1.7 -2.0 -2.0

% of GDP -12.1 -3.9 -3.6 -3.9 -3.6

Reserves 30.8 30.0 31.8 34.9 38.4

Public Finances

Revenue (LBP bn) 14.1 14.2 14.2 14.1 14.0

Expenditure (LBP bn) 17.6 20.1 19.9 19.9 20.1

Balance -3.5 -5.9 -5.7 -5.8 -6.1

% of GDP -5.8 -9.2 -9.6 -9.2 -8.9

Central Government Debt (LBP bn) 80.9 87.0 100.0 114.0 120.0

% of GDP 133.8 135.8 142.9 148.6 142.9

Source: Haver Analytics, Emirates NBD Research

Page 25: MENA Quarterly - Emirates NBD · economy among the oil importers, ... MENA Quarterly ... We expect Qatar and the UAE to be the fastest growing economies in

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Key Economic Forecasts: Morocco

National Income 2011 2012 2013 2014f 2015f

Nominal GDP (MAD bn) 802.6 828.2 887.9 951.0 1050.5

Nominal GDP (USD bn) 99.2 96.0 102.9 110.2 121.7

GDP per capita (USD) 3074 2944 3126 3315 3627

Real GDP Growth (% y/y) 5.0 2.7 4.2 3.1 5.5

Monetary Indicators (% y/y)

M2 7.2 4.9 4.5 5.5 6.5

CPI (average) 0.9 1.3 3.0 4.0 5.0

External Accounts (USD bn)

Exports 21.6 21.4 21.9 23.2 24.8

Imports 40.9 41.5 40.7 41.9 43.5

Trade Balance -19.3 -20.1 -18.8 -18.7 -18.8

% of GDP -19.4 -20.9 -18.3 -17.0 -15.4

Current Account Balance -8.0 -9.3 -8.1 -7.4 -6.8

% of GDP -8.0 -9.7 -7.8 -6.7 -5.6

Reserves 20.9 17.4 18.6 20.0 0.0

Public Finances

Revenue (MAD bn) 19.2 19.9 20.5 21.2 22.8

Expenditure (MAD bn) 18.6 217.0 217.3 225.3 235.5

Balance* -40.5 -62.1 -51.4 -50.4 -45.2

% of GDP -5.0 -7.5 -5.8 -5.3 -4.3

Central Government Debt (MAD bn) 430.9 493.7 543.0 570.2 604.4

% of GDP 53.7 59.6 61.2 60.0 57.5

Source: Haver Analytics, Emirates NBD Research Note: * includes balance of treasury accounts and minus investments

Page 26: MENA Quarterly - Emirates NBD · economy among the oil importers, ... MENA Quarterly ... We expect Qatar and the UAE to be the fastest growing economies in

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Key Economic Forecasts: Oman

National Income 2011 2012 2013f 2014f 2015f

Nominal GDP (OMR bn) 26.7 29.8 32.1 33.6 35.3

Nominal GDP (USD bn) 69.4 77.4 83.3 87.2 91.7

GDP per capita (USD) 21070 22371 23617 24226 24966

Real GDP Growth (% y/y) 4.1 5.7 4.7 4.0 3.6

Monetary Indicators (% y/y)

M2 12.2 10.7 7.0 7.0 6.5

Private sector credit 12.9 15.0 7.5 8.0 7.5

CPI (average) 4.0 2.9 1.3 2.5 3.0

External Accounts (USD bn)

Exports 47.2 52.2 55.3 56.0 56.7

Of which: hydrocarbons 33.4 36.4 37.9 36.9 36.6

Imports 21.5 25.7 28.2 31.1 32.6

Trade balance 25.6 26.5 27.1 25.0 24.1

% GDP 36.9 34.3 32.5 28.6 26.3

Current account balance 9.0 8.2 7.8 4.7 3.3

% GDP 12.9 10.5 9.3 5.4 3.6

Fiscal Indicators (% GDP)

Budget balance 6.3 0.9 0.0 -1.6 -1.0

Revenue 46.5 47.2 40.5 38.6 37.3

Expenditure 40.2 46.2 40.5 40.2 38.3

Source: Haver Analytics, Emirates NBD Research

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Key Economic Forecasts: Qatar

National Income 2011 2012 2013f 2014f 2015f

Nominal GDP (QAR bn) 624.2 700.3 738.9 766.3 824.6

Nominal GDP (USD bn) 171.5 192.4 203.0 210.5 226.5

GDP per capita (USD) 100396 104737 106250 105955 109630

Real GDP Growth (% y/y) 13.0 6.2 6.0 5.2 6.1

Hydrocarbon 15.7 1.7 0.0 -1.0 0.0

Non- hydrocarbon 10.1 9.9 10.0 9.0 9.5

Monetary Indicators (% y/y)

M2 17.1 22.9 18.0 15.0 16.0

Private sector credit 18.6 13.5 13.5 15.5 16.0

CPI (average) 1.9 1.9 3.0 4.0 4.5

External Accounts (USD bn)

Exports 114.4 118.9 118.2 118.3 114.8

Of which: hydrocarbons 105.4 108.2 106.3 105.9 102.0

Imports 32.3 34.9 39.0 42.1 46.8

Trade balance 82.1 84.0 79.2 76.2 68.0

% GDP 47.9 43.7 39.0 36.2 30.0

Current account balance 52.7 53.4 53.8 49.6 41.3

% GDP 30.7 27.8 26.5 23.5 18.2

Total external debt 126.4 150.5 156.4

% GDP 73.7 78.2 77.1

Fiscal Indicators (% GDP)

Budget balance 7.7 11.8 5.9 4.8 5.7

Revenue 35.7 40.0 34.7 33.8 34.5

Expenditure 27.9 28.2 28.7 29.0 28.8

Source: Haver Analytics, IMF, Emirates NBD Research

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Key Economic Forecasts: Saudi Arabia

National Income 2011 2012 2013f 2014f 2015f

Nominal GDP (SAR bn) 2510.7 2752.3 2794.8 2853.4 2974.5

Nominal GDP (USD bn) 669.5 734.0 745.3 760.9 793.2

GDP per capita (USD) 23591 25108 24753 24536 25578

Real GDP Growth (% y/y) 8.6 5.8 3.8 4.2 4.3

Hydrocarbon 11.0 5.5 -0.6 0.0 1.0

Non- hydrocarbon 8.0 5.0 5.9 5.4 5.2

Monetary Indicators (% y/y)

M2 13.3 13.9 9.4 10.0 10.0

Private sector credit 10.6 16.4 13.6 14.0 10.0

CPI (average) 4.0 2.9 3.5 4.0 4.2

External Accounts (USD bn)

Exports 364.6 388.2 380.1 370.9 370.6

Of which: hydrocarbons 317.6 342.5 323.3 308.4 303.8

Imports 120.0 141.8 156.0 166.9 183.6

Trade balance 244.6 246.4 224.1 204.0 187.0

% GDP 36.5 33.6 30.1 26.8 23.6

Current account balance 157.6 163.6 133.4 111.9 91.0

% GDP 23.5 22.3 17.9 14.7 11.5

SAMA's Net foreign Assets 535.2 647.6

Fiscal Indicators (% GDP)

Budget balance 11.6 13.6 7.4 4.6 3.3

Revenue 44.5 45.3 40.5 38.0 36.3

Expenditure 32.9 31.7 33.1 33.4 33.0

Public debt 5.4 3.6 2.7

Source: Haver Analytics, Emirates NBD Research

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Page 29

Key Economic Forecasts: Tunisia

National Income 2011 2012 2013 2014f 2015f

Nominal GDP (TND bn) 64.7 70.5 77.0 84.4 92.7

Nominal GDP (USD bn) 46.0 45.1 47.4 52.1 57.2

GDP per capita (USD) 4043 3935 4348 4739 4769

Real GDP Growth (% y/y) -0.2 4.2 3.1 3.4 3.6

Monetary Indicators (% y/y)

M2 9.3 8.2 5.0 8.0 10.0

CPI (average) 3.5 5.6 6.2 6.0 5.8

External Accounts (USD bn)

Exports 17.8 17.0 17.6 18.6 20.1

Imports 22.6 23.1 23.3 24.6 26.0

Trade Balance -4.8 -6.1 -5.7 -6.0 -6.0

% of GDP -10.4 -13.5 -12.0 -11.5 -10.4

Current Account Balance -3.4 -3.7 -3.2 -3.5 -3.1

% of GDP -7.4 -8.2 -6.8 -6.7 -5.5

Reserves 7.6 8.6 7.5 7.6 8.1

Public Finances

Revenue (TND bn) 16.8 18.5 18.9 20.0 21.0

Expenditure (TND bn) 18.3 20.4 23. 1 24.2 25. 2

Balance* -1.6 -1.9 -4.2 -4.2 -4.2

% of GDP -3.5 -5.5 -7.7 -7.1 -6.4

Central Government Debt (TND bn) 28.8 32.9 36.2 39.8 43.8

% of GDP 44.4 44.3 47.0 51.7 56.9

Source: Haver Analytics, Emirates NBD Research Note: * does not include privatizations fees and grants

Page 30: MENA Quarterly - Emirates NBD · economy among the oil importers, ... MENA Quarterly ... We expect Qatar and the UAE to be the fastest growing economies in

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Key Economic Forecasts: UAE

National Income 2011 2012 2013f 2014f 2015f

Nominal GDP (AED bn) 1280.2 1409.5 1418.4 1488.6 1578.2

Nominal GDP (USD bn) 348.8 384.1 386.5 405.6 430.0

GDP per capita (USD) 41383 44669 44071 45345 47132

Real GDP Growth* (% y/y) 3.9 4.4 4.6 4.5 4.5

Abu Dhabi* 9.3 5.6

Dubai* 3.0 4.4 4.5 4.7 4.5

Monetary Indicators (% y/y)

M2 5.0 4.4 10.5 7.5 8.0

Private sector credit 2.1 2.1 9.5 8.0 8.5

CPI (average) 0.9 0.7 1.1 3.0 3.5

External Accounts (USD bn)

Exports 299.2 347.0 369.0 391.5 420.9

Of which: hydrocarbons 111.6 118.1 117.6 114.9 114.1

Imports 196.3 222.8 246.8 270.0 299.3

Trade balance 102.9 124.2 122.2 121.5 121.6

% GDP 29.5 32.3 31.6 30.0 28.3

Current account balance 48.1 63.5 58.1 54.1 50.2

% GDP 13.8 16.5 15.0 13.3 11.7

Fiscal Indicators (% GDP)

Consolidated budget balance 4.1 8.6 8.6 6.8 6.2

Revenue 34.3 35.1 34.9 32.6 31.8

Expenditure 30.3 26.5 26.3 25.9 25.6

* UAE real growth data are sourced from NBS to 2012, with Emirates NBD forecasts for 2013 and 2014. Dubai’s real growth data are sourced from Dubai Statistics Centre. Abu Dhabi’s real growth data are sourced from Statistics Centre Abu Dhabi. Source: Haver Analytics, IMF, National sources, Emirates NBD Research

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Emirates NBD Research& Treasury Contact List Emirates NBD Head Office 12th Floor Baniyas Road, Deira P.O Box 777 Dubai Aazar Ali Khwaja Executive Vice President, Global Markets & Treasury +971 4 609 3000 [email protected]

Tim Fox Head of Research & Chief Economist +971 4 230 7800 [email protected]

Research

Khatija Haque Head of MENA Research +971 4 509 3065 [email protected]

Irfan Ellam Head of MENA Equity Research +971 4 509 3064 [email protected]

Aditya Pugalia Research Analyst +971 4 230 7802 [email protected]

Jean-Paul Pigat MENA Economist +971 4 230 7807 [email protected]

Sales & Structuring

Head of Sales & Structuring Sajjid Sadiq Sayed +9714230 7777 [email protected]

Saudi Arabia Sales Numair Attiyah +9661282 5625 [email protected]

Singapore Sales Supriyakumar Sakhalkar +65 6 578 5627 [email protected]

London Sales Lee Sims +44 (0)20 7838 2240 [email protected]

Egypt Shahinaz Foda +20 22 726 5050 [email protected]

Group Corporate Affairs

Ibrahim Sowaidan +971 4 609 4113 [email protected]

Claire Andrea +971 4 609 4143 [email protected]