How the size of the UAE’s economy compares to others in the region: The UAE was among the top performing economies across the MENA region in the period between 2017-2023, according to the UN’s International Comparison Program (ICP) latest report (pdf) comparing the real sizes of Arab economies between the aforementioned period.

But first, a quick look at the report’s methodology: The report looks into the results of Arab country’s economic performances over the span of 2017-2023 using a purchasing power parities (PPP) method, which converts different currencies to a common currency as a means of equalizing their purchasing power by “eliminating differences in price levels between economies.” In effect, a PPP-based analysis shows “the relative price of a given basket of goods and services in each of the economies being compared,” providing insights over the real purchasing power of currencies.

The report also uses actual individual consumption (AIC) to gauge material well-being across Arab economies — which measures all individual consumption, including consumption expenditure by governments, non-profit institutions, and individuals.

How we fared: The UAE was the third largest Arab economy in the region in 2021, accounting for 9.0% of regional output in PPP terms despite being home to only 2.0% of the region’s total population. We came in third place after Egypt and Saudi Arabia on a regional level, with the three countries accounting for 60% of the total regional output.

The UAE had the highest level of material well-being in the region during the period, followed by Kuwait and then Qatar. On a global scale, the UAE came in 24th place with an average per capita AIC of USD 32k in PPP terms. The UAE’s PPP-based AIC per capita reached 248% of the global average.

But it was also among the most expensive: The UAE came in second only to Kuwait in terms of the most expensive Arab countries at the total economy level in 2023. However, the UAE was also the second wealthiest nation in the region — a common correlation, according to the report, which said that “the wealthier a country, the more expensive it tends to be.” In 2021, Qatar and the UAE were the most expensive countries in the region, with the UAE exceeding the world average by 21.0%.

The UAE was also among the biggest spenders on investment regionally: The UAE came second only to Saudi Arabia in terms of expenditure on investment in 2021, accounting for 11.8% of total investment expenditure in the region in PPP terms.

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