Propelling a future guided by vision: UAE accelerates development through reforms, creativity, and investment
UAE's Economic Growth Soars Towards 6.7% in 2025
The United Arab Emirates (UAE) is poised for significant economic growth in the coming years, with projections suggesting a potential 6.7% expansion in 2025. This robust growth is attributed to a diverse array of factors, including strategic economic diversification, fiscal discipline, and innovative regulatory reforms.
Kristalina Georgieva, the Managing Director of the International Monetary Fund (IMF), recently praised the UAE's global integration, stating that Comprehensive Economic Partnership Agreements (CEPAs) are unlocking new markets and enhancing trade efficiency. The UAE has been actively modernizing over 30 key economic laws in the past four years, covering sectors such as e-commerce, arbitration, commercial transactions, family businesses, and cooperatives.
Non-oil sectors, including tourism, artificial intelligence (AI), renewables, financial services, real estate, and transport, are expected to dominate over 75% of the UAE’s GDP by 2025. Tourism alone is projected to contribute 13% of GDP. These sectors are growing due to policy reforms and investment incentives that have attracted over $150 billion in clean energy investments and positioned the UAE as a global innovation hub.
While the hydrocarbon sector's growth remains relevant, it is forecasted to grow 4.1% in 2025 and surge in 2026 due to easing OPEC+ quotas, complementing non-oil growth, which is projected around 4.5%. Key non-oil sectors contributing to growth include finance, insurance, real estate, construction, transportation, human health and social work, accommodation, and food services.
The UAE's economic resilience is reinforced by AA-level sovereign credit ratings from S&P, Moody’s, and Fitch, reflecting fiscal discipline and healthy sovereign buffers. This helps sustain investor confidence and capital inflows.
Strategic reforms like the CEPAs, exchange-traded funds (ETFs), and investments in green infrastructure accelerate diversification and sustainable growth. The UAE aims to have 27 CEPA agreements, supercharging its global trade ambitions.
The growth outlook is further supported by employment expansion (projected 3.3% in 2025) and low unemployment (~2.1%), as well as a current account surplus of approximately 6.2% of GDP in 2025, enabling macroeconomic stability.
Abdulla bin Touq Al Marri, the UAE Minister of Economy, recently commented on the country's economic momentum at the 55th Annual Meeting of the World Economic Forum in Davos. The "We the UAE 2031" vision targets top 10 global rankings in human development, food security, and quality of life, while aiming to be the safest country and a leader in AI and clean energy.
The financial and insurance sector grew 7% in 2024, supported by strong bank performance and capital inflows. The UAE's commitment to sustainability, amplified by its COP28 hosting, has elevated its global standing. Initiatives such as 100% foreign ownership, streamlined business registration, and the expansion of over 40 free zones have solidified the UAE's appeal as a magnet for global capital and talent.
Over 200,000 new economic licenses were issued in 2024, signaling the UAE's vibrant entrepreneurial ecosystem. Non-oil exports to partners like India, Turkey, and Indonesia grew by double digits in 2024 due to these agreements. The Soft Power Index placed the UAE 10th worldwide, while Numbeo and Gitnux reports consistently name it among the safest countries.
In summary, the UAE's strong economic growth towards and beyond 2025 to potentially 6.7% is driven by a blend of robust non-oil sector expansion, ongoing oil sector contributions, solid fiscal and monetary policy frameworks, strategic investments in innovation and sustainability, and broad sectoral dynamism across finance, tourism, health, real estate, and transportation. This aligns the country’s economic trajectory with its long-term vision goals for 2030 and beyond.
- The UAE's economic growth in 2025 is projected to be driven by diversified factors such as strategic economic diversification, fiscal discipline, innovative reforms, and global integration through Comprehensive Economic Partnership Agreements (CEPAs).
- In the coming years, the non-oil sectors like tourism, AI, renewables, financial services, real estate, transport, and more are expected to account for over 75% of the UAE’s GDP.
- Tourism alone is projected to contribute 13% of the GDP, and other key sectors contributing to growth include finance, insurance, real estate, construction, transportation, human health, and food services.
- The ongoing growth in the hydrocarbon sector is projected to grow 4.1% in 2025 and surge in 2026 due to easing OPEC+ quotas, complementing non-oil growth.
- A diverse array of economic sectors and strategic reforms like CEPAs, exchange-traded funds (ETFs), and investments in green infrastructure are accelerating diversification and sustainable growth.
- The UAE aims to have 27 CEPA agreements, aiming to supercharge its global trade ambitions and solidify its appeal as a magnet for global capital and talent.
- The UAE's economic resilience is fortified by its AA-level sovereign credit ratings, low unemployment, and a current account surplus, enabling macroeconomic stability.
- Strategic progress like the financial and insurance sector's 7% growth in 2024, employment expansion, and the issuance of over 200,000 new economic licenses in 2024 signal the UAE's vibrant entrepreneurial ecosystem and vitality on the world stage.
- The UAE's commitment to sustainability, foreign ownership policies, streamlined business registration, and expansion of free zones have elevated its global standing, as demonstrated by its placement on the Soft Power Index, Numbeo, and Gitnux reports.
