According to the latest quarterly economic review released by the Central Bank of the UAE (CBUAE), the UAE economy is projected to experience significant growth. The report forecasts a 4.7% increase in the UAE's Gross Domestic Product (GDP) in 2025, further accelerating to 5.7% in 2026.
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03-25, 2025The report emphasizes that the UAE's non-oil trade exceeded AED 2 trillion in the first nine months of 2024, representing a year-on-year increase of 14.9%. This growth, the report notes, "reflects the successful implementation of the UAE's economic diversification plans and the strengthening of relationships with key trading partners."
The UAE Central Bank anticipates a 5.1% growth in the non-hydrocarbon sector in 2025. Concurrently, the hydrocarbon sector is projected to grow by 3.6% in 2025, followed by a significant increase of 8.5% in 2026. This growth is attributed to the gradual phasing out of production cuts by OPEC+ and ongoing and planned upstream and midstream oil and gas projects.
The report also highlights a 10% increase in passenger traffic at UAE airports in 2024. "Abu Dhabi Airport reported significant growth, handling 29.4 million passengers in 2024, a 28.1% increase from 2023, driven by network expansion, strategic partnerships, and a focus on delivering a world-class passenger experience," the report states. It further emphasizes that "Abu Dhabi's expanding role as a hub for leisure and business travel is significantly contributing to the UAE's economic diversification."
Meanwhile, Dubai International Airport also achieved a new milestone in 2024, welcoming 92.3 million passengers, surpassing the previous peak of 89.1 million recorded in 2018. The report suggests that the UAE's tourism and aviation sectors remain key drivers of economic diversification.
The report indicates that the continued growth in these sectors "reflects the success of initiatives aimed at enhancing connectivity, expanding hospitality infrastructure, and promoting the UAE as a global leisure and business travel destination."
The UAE banking sector remains robust, with total assets reaching AED 4.56 trillion by the end of 2024. Loans grew by 9.5% year-on-year, driven by increased retail and corporate lending, while deposit growth reached 12.9% in the fourth quarter of 2024. The insurance sector also demonstrated significant growth, with gross written premiums increasing by 21.4% year-on-year and gross claims paid rising by 35.8%.
The report further points out that the UAE government recorded a fiscal surplus of AED 96.3 billion (6.5% of GDP) in the first nine months of 2024, a 57.5% increase compared to the same period in 2023, driven by a 22.1% increase in tax revenues. Government capital expenditure increased by 15.4% year-on-year, indicating the government's commitment to infrastructure development and economic expansion.
Inflation in the UAE remained well-controlled at 1.7% in 2024, significantly below the global average of 5.7%. The UAE Central Bank maintains its inflation forecast for the UAE at 2.0% for 2025, anticipating that non-tradable components of the consumer basket will be the main driver, with moderating energy prices providing some offset.
In the first nine months of 2024, the UAE's imports reached AED 1.177 trillion, representing a year-on-year increase of 12.9%, with China, India, and the United States identified as major trading partners. Gold remains a significant trade commodity, accounting for 23.5% of total imports and 48.6% of non-oil exports.
