Inflation to increase in the U.A.E. this year

In 2018, inflation is expected to rise to 3.3% in the United Arab Emirates as a result of the 5% V.A.T. introduced in January 2018, plus higher oil prices that will increase transportation costs and support domestic demand. Saudi Arabia and the U.A.E. – the Gulf’s biggest economies – introduced V.A.T. in January to narrow their widening fiscal deficits, as oil prices fell from US$115 per barrel in 2014 to under US$30 at the beginning of 2016.