Powered by a dynamic non-oil sector, the UAE, the Arab world’s second-largest economy, continues to experience strong growth, according to the Organisation of the Petroleum Exporting Countries (Opec).
Opec’s August 2024 report highlights the UAE’s robust economic policies and strategic partnerships, which position the country well to sustain its growth and diversify its economy. This outlook aligns with forecasts from the Arab Monetary Fund (AMF), World Bank, International Monetary Fund (IMF), and the Central Bank of the UAE.
The AMF predicts the UAE economy will grow by 6.2% in 2025, following a 3.9% increase this year, driven by improvements in tourism, real estate, international trade, and increased capital investment.
Opec also noted a slight increase in the UAE’s Consumer Price Index, with housing and utilities up to 6.7% year-on-year in June. Food and beverage inflation remained stable, edging up to 2.4% year-on-year. The UAE Central Bank recently signed currency swap agreements with Ethiopia, the Seychelles, and Indonesia to enhance cross-border transactions.
Economists credit a series of Comprehensive Economic Partnership Agreements (Cepa) for bolstering the UAE’s status as a global trade hub, with the latest signed with Mauritius. The UAE aims to double its GDP to over $800B by the decade’s end, focusing on its role as a global business hub.
The Central Bank of the UAE expects foreign trade to support GDP growth of 3.9% in 2024, accelerating to 6.2% in 2025. Meanwhile, the World Bank raised its 2025 growth forecast for the UAE to 4.1%, projecting continued current account and fiscal surpluses.