The UAE ranked seventh in the world in terms of per capita national income, according to the latest data released by the World Bank.
According to Khaleej Times, the per capita income in the UAE, based on purchasing power parity (PPP) in current international dollars, rose to Int$87,729 in July 2022, an increase of Int$10,781 from 2021.
The international dollar is a virtual currency used to compare the purchasing power of different countries. It is based on the US dollar, but it has the same purchasing power as the local currency in each country.
According to the latest update by the World Bank, the UAE solidified its position on the list of countries with the highest income per capita based on the Atlas method while also using current US dollar prices.
The World Bank classifies the world’s economies into four groups based on income using the Atlas method, which are low-income, lower-middle-income, upper-middle-income and high-income. The classifications are updated yearly at the beginning of July based on per capita income from the previous fiscal year.
According to the Atlas method, the per capita national income in the UAE, in current US dollars, increased to $48,950 in 2022 from its previous level of $43,460 in 2021, surpassing the pre-Covid-19 level of $46,210.
The expression of Gross National Income (GNI) in US dollars is done using the Atlas method, which was introduced in its current form in 1989 and utilised derived conversion factors.
The classifications can change for two reasons. Firstly, there could be changes in per capita GNI according to the Atlas method. Economic growth, inflation, exchange rates and population growth can affect the per capita income level according to the Atlas method in each country. Reviews related to improving methods and data can also have an impact.
Secondly, changes aimed at maintaining income boundaries in real terms as annual adjustments for inflation are made using the Special Drawing Rights (SDR) deflator, which is a weighted average of the deflators for gross domestic product in China, Japan, the UK, the US and the EU.
The new classification boundaries for per capita gross national income under the Atlas method for 2022 differ from 2021.
In the latest classification, countries with low income have a per capita income of less than $1,135, lower-middle-income ranges from $1,136 to $4,465, upper-middle-income ranges from $4,466 to $13,845, while high-income is above $13,845.
In the previous classification, the thresholds were lower for all categories, with low-income countries having a per capita income of less than $1,085, lower-middle-income ranges from $1,086 to $4,255, upper-middle-income ranges from $4,256 to $13,205, and high-income exceeds $13,205.
Regarding per capita GNI, according to the Atlas method, nearly 80 per cent of countries showed improvements in 2022 from the pre-pandemic period in 2019. (NewsWire)