The International Monetary Fund (IMF) noted Thursday that economic recovery in the United Arab Emirates (UAE) was on track, but warned that the huge amount of debt carried by government related entities (GREs) continue to weaken the real estate market.

In a public information note posted on the IMF's website, the fund said that the "UAE's GRE indebtedness, refinancing needs and reliance on foreign funding remain high, with about 30 billion U.S. dollars GRE debt maturing this year and significant amount of debt falling due in 2014 to 2015."

The note followed a meeting between the IMF's executive board and the UAE government earlier in the week.

Earlier in January this year at the World Economic Forum (WEF) in Davos, Mohammed Al-Shaibani, the CEO of the GRE Investment Corporation of Dubai, said he was confident that Dubai will "hit its repayment targets in 2012."

In July 2011, the country's largest GRE Dubai World successfully restructured 24.9 billion dollars worth of debt, mainly because its real estate developers got under financial pressure in the wake of the global crisis.

The IMF added that UAE's real economy to grow by 2.3 percent in 2012, down from 4.9 percent in the previous year. "For 2012, oil production is projected to be flat, whereas non-oil growth is expected to strengthen further to 3.5 percent," the note said.

While the IMF lauded the UAE's fiscal policy it added that due to the GREs burden of refinancing debt in the coming years, the pressure on the Gulf state's real estate market will remain.