World Bank upgrades UAE's 2025 growth forecast to 4.6%, boosted by non-oil sector growth
The World Bank has revised the UAE's GDP forecast to 4.6% in 2025, up 0.6 percentage points from its January projection, with the country's non-oil sector emerging as a 'key contributor' for this growth.
The UAE's growth forecast for 2026 has also been revised to 4.9% for 2026, up 0.8 percentage points from January, with the country's oil GDP expected to expand, reflecting a phasing out of OPEC+ decisions, the World Bank said in its latest 'Global Economic Prospects' report.
'Gradual resumption of oil production between May 2025 and September 2026, is expected to support oil GDP growth despite downward pressure on global oil prices,' the World Bank said, adding that the non-oil sector will have a projected expansion of 4.9% in 2025, supported by growth in tourism, construction, transportation, and financial services
The momentum will continue into 2027, with a projected GDP growth forecast of 4.9%.
According to previous year figures, the UAE recorded robust economic growth in 2024, driven by strong domestic demand, structural reforms, and targeted investments. In 9M 2024 the real GDP expanded 3.7% year-on-year, supported by a 4.5% expansion in the non-oil sector.
The growth in 2025 has also been attributed to 'ongoing business climate reforms, infrastructure investments, and governance enhancements,' which have further supported economic diversification and competitiveness,' the report said. 'However, key sectors such as logistics may be impacted by ongoing trade uncertainties and disruptions.'
On Tuesday, the bank cut its global growth forecast for 2025 by 0.4 percentage points to 2.3%, saying that higher tariffs and heightened uncertainty posed a 'significant headwind' for nearly all economies.
The bank lowered its forecasts for nearly 70% of all economies, including the US, China and Europe, as well as six emerging market regions, but ruled out a global recession.
Meanwhile, GCC economies will grow 3.2% for 2025, 4.5% for 2026, and 4.8% for 2027.
(Writing by Bindu Rai, editing by Daniel Luiz)
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