Gulf In Focus - GULF STATES/ ECONOMICS and FINANCE - UAE, Saudi non-oil sector key to reignite me growth.

The non-oil sector of the UAE and Saudi Arabia is expected to a play key role in generating economic growth and employment in the Middle East as the regional economies face a challenging 2019, the Institute for Chartered Accountants for England and Wales (ICAEW) said.

The non-oil sector in the GCC to accelerate from an estimated 2.3 per cent last year to 2.6 per cent in 2019 as several proxy indicators of economic activity paint a positive picture, with the credit to the private sector trending up in most GCC countries, ICAEW said in its latest Economic Insight report produced in partnership with Oxford Economics.

Other bullish indicators include some improvements in the quarterly average of the purchasing manager index, a gauge of the health of the private sector in both Saudi Arabia and the UAE, the two largest economies in the GCC, in first quarter compared to last quarter 2018, the report said.

The non-oil sector resilience in the GCC is supported by various pro-growth government initiatives, expansionary budgets and fiscal stimulus plans, especially in Saudi Arabia and the UAE, ICAEW said.

"In other notable developments, deflationary pressures were evident in several GCC countries in the beginning of 2019, largely reflecting material declines in the 'housing and utilities' component of the CPI index, which traditionally has the largest weight in the consumer basket," ICAEW pointed out in its report.

Michael Armstrong, ICAEW regional director for the Middle East, Africa and South...