- UAE’s economy projected to grow 5% in 2025 due to strong non-oil sector and tech investment.
- World Bank upgrades forecast, citing strength in hydrocarbons and diversified industries.
- UAE and Qatar maintain fiscal resilience amid global oil price uncertainty.
The UAE’s ambitious economic diversification strategy, backed by growing investment in artificial intelligence and IT infrastructure, is fueling optimism for a 5% GDP growth rate in 2025.
Meanwhile, broader GCC growth prospects remain bright, with rising consumer demand and increasing labor participation expected to drive regional expansion.
UAE’s AI Push and Strategic Trade Role Poised to Power 2025 Economic Growth
The UAE’s forecasted 5% GDP growth reflects the success of its long-term economic vision focused on diversification beyond oil. The government’s investments in AI and productivity-enhancing technologies are central to this transformation, with sectors like real estate and infrastructure also expanding rapidly.
Yerlan Syzdykov points out that the UAE’s role as a global trade connector positions it favorably in a shifting geopolitical environment. Capital inflows from the Global South and its open market policies provide a stable foundation for continued growth, even amid rising global uncertainties.
While the World Bank’s revised forecast for the UAE (4.6% for 2024 and 4.9% for 2025) acknowledges the country’s performance across sectors, Syzdykov warns that regional economies could face fiscal pressure if oil prices fall. However, the UAE’s cautious oil revenue assumptions offer a cushion compared to its Gulf peers.
In response to soft oil markets, GCC governments may pursue more public listings to diversify income. This IPO drive is not only a funding strategy but a way to boost investor confidence and transparency in the region’s evolving economic landscape.
With solid fundamentals, strategic reforms, and a resilient fiscal approach, the UAE is well-positioned to sustain growth momentum, reinforcing its role as a key economic force in the region.
“The UAE’s ‘connector economy’ role is the main factor to its success, underpinning trade and capital flows into the country.”
— Yerlan Syzdykov, Global Head of Emerging Markets, Amundi
