UAE’s per capita national income continues its upward trajectory, securing the country’s position as the seventh highest in the world, as per recent data released by the World Bank. The UAE’s per capita income, based on purchasing power parity (PPP) in current international dollars, reached Int$87,729 in July 2022, reflecting an increase of Int$10,781 from the previous year.
The international dollar serves as a virtual currency used to compare purchasing power across different nations, equivalent to the local currency’s purchasing power within each country. This latest update by the World Bank reaffirms the UAE’s standing among countries with the highest income per capita, utilizing the Atlas method and current US dollar prices.
Under the Atlas method, the UAE’s per capita national income in current US dollars rose to $48,950 in 2022 from $43,460 in 2021, surpassing the pre-COVID-19 level of $46,210. The Atlas method for expressing Gross National Income (GNI) in US dollars was introduced in 1989 and employs derived conversion factors.
The World Bank’s classifications based on the Atlas method categorize economies into low-income, lower-middle-income, upper-middle-income, and high-income groups. These classifications are annually updated at the beginning of July, considering per capita income from the previous fiscal year.
Two key factors can lead to changes in these classifications. Firstly, fluctuations in per capita GNI according to the Atlas method occur due to economic growth, inflation, exchange rates, and population growth in each country. Additionally, reviews focused on methodological improvements and data can also impact the classifications.
Secondly, adjustments to maintain income boundaries in real terms are made using the Special Drawing Rights (SDR) deflator, a weighted average of gross domestic product deflators in China, Japan, the UK, the US, and the EU.
The new classification boundaries for per capita gross national income under the Atlas method in 2022 differ from those in 2021. The threshold for low-income countries increased to less than $1,135, lower-middle-income ranges from $1,136 to $4,465, upper-middle-income ranges from $4,466 to $13,845, and high-income exceeds $13,845.
The latest data reveals that approximately 80% of countries experienced improvements in per capita GNI in 2022 compared to the pre-pandemic period in 2019.
The UAE’s consistent rise in per capita income showcases the nation’s strong economic growth and stability. This achievement reinforces the UAE’s position as a prosperous country with a high standard of living, offering its residents and citizens ample opportunities for economic prosperity and development.
