UAE Economy to Grow 6.2% by 2025

The Arab Monetary Fund (AMF) projects a significant 6.2% growth for the UAE economy in 2025. This forecast follows an anticipated 3.9% growth in 2024. The AMF’s Arab Economic Outlook report attributes this positive trend to several factors, including improvements in tourism, real estate, international trade, and increased capital spending. The UAE’s economy is supported by strong fundamentals, a dynamic non-oil sector, and robust public and monetary policies.

The report highlights the UAE’s strategic initiatives to enhance its position as a global trade and finance hub. Continuous infrastructure development, a strong regulatory framework attracting foreign investment, and a focus on innovation and technology-based sectors are key to the country’s growth. The UAE saw significant economic growth of 7.5% in 2022, driven by a strong response to the COVID-19 pandemic and supportive financial measures. The tourism and fuel sectors also contributed to the growth, with a positive rate of about 3.6% achieved in 2023.

Regionally, the AMF report predicts an improvement in the growth rate of Arab economies, with a projected 2.8% growth in 2024, up from 0.3% in 2023, and further improvement to 4.5% in 2025. This growth is supported by declining interest rates, controlled inflation, stable oil prices, and commodity price stability. Major oil-exporting countries are expected to benefit from improved energy price levels, with Saudi Arabia projected to grow by 4.4% in 2024 and 5.7% in 2025, Qatar by 1.8% and 3.1%, Kuwait by 2.7% and 3%, Oman by 2.3% and 2.7%, and Bahrain by 3.5% and 3.2%.

The UAE’s economic outlook remains robust, with diverse growth drivers and strategic initiatives fostering innovation and attracting investment. The country’s strong fundamentals and dynamic non-oil sector make it a key player in the Arab region’s economic landscape.