2023-05-10 16:29:55
Wednesday, May 10, 2023 – 8:29 PM
ABU DHABI, 10th May / WAM / His Highness Sheikh Mansour bin Zayed Al Nahyan, Vice President, Deputy Prime Minister, Minister of the Presidential Court, Chairman of the Board of Directors of the Central Bank, affirmed the Central Bank’s continuous efforts to maintain monetary and financial stability and control and supervision of financial institutions. In addition to ensuring the operation and qualitative utilization of the infrastructure for cash and electronic payments, and increasing focus on countering money laundering, combating terrorist financing, and protecting consumers in the financial services sector.
In his speech on the annual report of the UAE Central Bank for the year 2022, His Highness said: “In the year 2022, the UAE was able to overcome the obstacles that emerged as a result of the “Covid-19” pandemic, and vaccination campaigns that boosted immunity spread on a large scale. With the return of commercial activities globally, most of them witnessed In developed and developing countries, there has been a significant increase in inflation, which has reached levels that far exceeded the inflation targets set in most developed economies.At the macroeconomic level, the emergence of factors driving inflation has been observed, following the closures that were imposed in the wake of the outbreak of the (Covid-19) pandemic were eased. This includes a strong recovery in total consumer and commercial demand, disruptions to global supply chains and difficult business conditions in the markets.
His Highness added: “These motives have increased dramatically as a result of the increasing geopolitical tensions in some regions of the world, which also contributed directly to the rise in oil, gas and other basic commodities prices to record historical levels. We concluded in our latest assessment that the risks of the global economy falling under The burden of recession remains in the near term, while uncertainty persists over the outlook in the medium term.
And His Highness continued: “Against the backdrop of global uncertainties and geopolitical tensions that may threaten the macroeconomy, the Central Bank continued to implement a strong and flexible policy within the framework of its macro and monetary prudential policy and its future supervisory duties. And the Central Bank, when setting its policy, took into account the strategic road map that the UAE government is pursuing to maintain the country’s competitiveness, ensure high economic growth, and achieve full employment for its citizens.
His Highness added: “In this regard, we find that the strong policy framework adopted by the Central Bank has provided the necessary basis for achieving the targeted economic results for the country, and in the light of which it was able to record a growth in GDP estimated at 7.6% in the year 2022.”
His Highness said that despite the prevailing conditions and high inflation rates in general, the UAE witnessed a much lower rate than the global average of 8.8%, due in part to the Central Bank’s decision to comply with the strategy of the Federal Reserve System, and to raise the interest rate to 4.4%, as well as the rise in the exchange rate of the dirham.
His Highness clarified that the country’s credit rating remained high at “Aa2” and “AA-” by Moody’s and “Fitch”, respectively, while the level of public debt was low at 40% of GDP, and credit continued to be granted at a steady pace. For the corporate and individual sectors alike, at a rate that supports economic growth.
His Highness said: “In its capacity as the overall precautionary authority of the state, the Central Bank has ended most of the temporary support measures aimed at helping the state face the repercussions of the (Covid-19) pandemic, as this decision reflected the return of the banking system to pre-pandemic levels of financial strength. The Central Bank’s insight was evident during the past year in facing unprecedented macroeconomic challenges and emerging risks, while its proactive responses contributed to supporting economic stability and the dynamism of the economy in general.”
His Highness added: “When looking at the future before us in the year 2023, and the following years, I believe that it is necessary to highlight two strategic priorities for the Central Bank, which also top the agendas of governments, central banks and those concerned with policy development at the global level. The strategic priority is represented in the Central Bank’s implementation of A digital transformation program that significantly contributes to strengthening the financial infrastructure within the Central Bank and at the state level.
His Highness continued: “Moreover, the Central Bank will contribute to the country’s policy initiatives on a large scale as part of its hosting of the Conference of the Parties (COP 28). It will also continue to take the necessary steps to ensure that climate risks are taken into account and to facilitate sustainable financing within the regulatory framework for the financial sector, and it will also adopt aspects of One of the principles of environmental, social and institutional governance in its investment policies and operations in the medium term.
His Highness concluded his speech by saying: “As for the Board of Directors of the Central Bank, I would like to take this opportunity to express my deepest gratitude to our senior management, our employees, all our partners and other relevant parties for their support and commitment to our vision in supporting the Central Bank’s directives to be the best among its peers. We have made clear progress towards achieving This ambitious goal is achieved in the year 2022, and I am absolutely certain that the Central Bank will continue its steadfast endeavors to achieve excellence, ensure the consolidation of a flexible financial system, and contribute to the continuous prosperity witnessed by the United Arab Emirates.
Reda Abdel Nour / Ramy Samih
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