Despite inflation pressures, increasing rent costs, and signs of economic crunch, the IMF’s World Economic Outlook (WEO) projects the UAE’s GDP to maintain a growth rate of 4% in 2024 and rise to 5.1% in 2025. 

As per a WEO report, the country’s non-oil solid sector and effective economic policies anticipate this growth.

The WEO also forecasts growth for the Middle East and Central Asia economies at 2.4% in 2024 and 3.9% in 2025. Globally, growth remains steady yet subdued, with projections of 3.2% for both years, unchanged from the IMF’s July and April 2024 outlooks.

Advanced economies are anticipated to see a slight increase in growth, from 1.7% in 2023 to 1.8% in 2024 and 2025, while emerging market and developing economies are expected to grow at 4.2% in both years, down from 4.4% in 2023.

Global inflation is predicted to decline from 6.7% in 2023 to 5.8% in 2024 and 4.3% in 2025. Advanced economies are expected to hit their inflation targets sooner than their emerging counterparts.

The WEO also notes that the U.S. economy is projected to grow by 2.8% in 2024, slowing to 2.2% in 2025, while the Eurozone is expected to see growth of 0.8% this year and 1.2% in 2024.

Earlier this month, the World Bank’s semi-annual MENA Economic Update forecasted UAE GDP growth at 3.3% for 2024, rising to 4.1% in 2025.

Meanwhile, the Arab Monetary Fund in July projected UAE economic growth at 3.9% in 2024, reaching 6.2% in 2025.

Despite diversification efforts, the UAE’s account surplus is expected to decline to 7.5% in 2024, down from 9.2% in 2023. 

However, the country’s economy remains bolstered by a strong non-oil sector and sound public and monetary policies that foster growth and financial stability.