The UAE has diversified its economy with a focus on finance, tourism, real estate, and technology, propelling it to new heights of economic prosperity.

According to the Central Bank of the UAE’s latest report, the UAE’s (CBUAE) economy is set for a strong upswing. The report projects GDP growth of 4.2% in 2024, accelerating to 5.2% in 2025, building on the estimated 3.1% growth achieved in 2023.

This optimistic outlook is fueled by the continued strength of the non-oil sector. The CBUAE forecasts non-oil GDP to expand by 4.7% in both 2024 and 2025, showcasing the growing diversification of the economy. 

Oil GDP is also expected to rebound, with projections of 2.9% growth in 2024 and a significant 6.2% increase in 2025.

The report highlights the UAE’s healthy fiscal position. A surplus of $16.6 billion (4.4% of GDP) was recorded in the first nine months of 2023, with government revenues exceeding expenditures. 

The recent implementation of a federal corporate tax is expected to strengthen finances and reduce reliance on oil revenue.

Business confidence is flourishing, as evidenced by a robust Purchasing Managers’ Index (PMI) of 56.6 in Dubai for January 2024. This indicator suggests sustained growth in the non-oil private sector, driven by positive expectations for continued demand, sales, and new investment opportunities.

The CBUAE report also points to promising signs for consumer spending. Positive job creation trends, with private sector employment rising 3.1% in Q4 of 2023 (based on a 3-month moving average) and a 7.4% wage increase during the same period, suggest strong future consumption levels.

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