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UAE economy seen growing by 5.1% this year: S&P Global’s Market Intelligence Unit sees the UAE’s real GDP growing by 5.1% in 2025 and 5.0% in 2026, Al Etihad reports, citing forecasts from S&P Global that it has seen.
Driving the growth: The UAE’s non-oil economy is expected to maintain its momentum in 2025, driven by robust demand for services, particularly in tourism, trade, and finance sectors. Meanwhile, the increase in oil production in the UAE in 2025 due to the recent adjustment in its Opec+ quota will help accelerate growth in 2025 and 2026, according to S&P Global. However, weaker oil price expectations for 2025 are likely to lead to a decline in export revenues and government income compared to 2024, the agency said.
Remember: The UAE is set to see a higher production quota of 3.5 mn barrels per day in 2025, up from the current 2.9 mn, after the oil cartel agreed to raise its production quota last year.
S&P Global sees inflation remaining stable at 1.8% in 2025, driven by a strong AED and stable monetary policy, with the only exception coming in the form of a slight interest rate cut expected in May, which would help balance strong domestic demand.
There’s no clear consensus over the UAE’s growth prospects this year: S&P Global’s forecast is in line with that of Fitch Solutions’ research unit BMI, which recently revised its forecast for the UAE’s economy this year to 5.1%, slightly down from 5.2% predicted in October, while the International Monetary Fund and the World Bank revised their forecasts for the UAE’s economy this year to 4.0%. Meanwhile, the Central Bank of the UAE (CBUAE) penciled in a higher growth estimate of 4.5% in 2025 in December.
REMEMBER- The UAE is targeting a GDP of AED 3 tn by 2031. The economy is on track to grow 7.0% annually in the coming period if interest rates and inflation continue to decline globally, Economy Minister Abdulla bin Touq Al Marri said earlier this month. Al Marri has repeatedly said 7.0% annual growth is a “ personal target ” of his, citing that figure in 2023 and 2024.
