The World Bank slashed its growth expectations for the United Arab Emirates to 2 percent for 2016, a 1.1 percent cut from 2015.
Considering oil prices have not recovered and governments have cut back their spending, the forecast for the UAE does not have a positive outlook.
"Modest efforts to expand revenue have also been implemented, including raising corporate and consumption taxes, but in the short term will not make up for large revenue losses in 2015 from plummeting oil prices," the bank’s report [ PDF ] said.
As for the rest of the MENA region, the World Bank forecasts growth to pick up slightly to 2.9 percent in 2016, but still 1.1 percent below the January estimate.
The main reason for the slight growth is an expected recovery in Iran, following the lift of sanctions in January. An expected increase in average oil prices in 2017 is also projected to support recovery in regional growth to 3.5 percent.
"This sluggish growth underscores why it’s critically important for countries to pursue policies that will boost economic growth and improve the lives of those living in extreme poverty," said World Bank Group President Jim Yong Kim in a statement when talking about the world global growth cut.