The UAE economy is projected to expand by 4.8% in 2025, according to the latest edition of the Gulf Economic Update (GEU) issued by the World Bank Group. Medium-term prospects remain favourable, with overall GDP growth expected to average 5% in 2026–2027, the report said.

“The country stands out for its diversified economy, with balanced growth between non-oil and oil sectors,” the GEU report noted.

The report said the UAE continues to demonstrate a high and stable level of diversification, with non-oil GDP reaching 77.8% of GDP in 2024, supported by strong performance in trade, tourism and real estate.

According to the report, economic growth remained robust at 3.9% year-on-year in Q1-2025, driven by a 5.3% expansion in non-oil activities. The GEU identifies manufacturing and financial and insurance services as the two largest contributors to Q1 growth, each accounting for 0.8 percentage points of GDP, followed by construction contributing 0.6 percentage points.

The World Bank expects non-oil activities to expand by 5.2% on average in 2026–2027, underpinning medium-term growth. Oil sector growth is projected to recover to 3.9% in 2025 and rise further to an average of 4.5% in 2026–2027, as production increases under the OPEC+ framework.

Source: Aletihad Newspaper