CBUAE projects 4.7% growth rate for 2025
23 Mar 2025 22:21
MAYS IBRAHIM (ABU DHABI)The UAE's economy is set for robust expansion, according to the Central Bank of the UAE (CBUAE). Its latest Quarterly Economic Review projects a 4.7% GDP growth in 2025, further accelerating to 5.7% in 2026.The report noted that the UAE's non-oil trade exceeded Dh2 trillion in the first nine months of 2024, a 14.9% year-on-year increase, "reflecting the successful implementation of the UAE's economic diversification plans and strengthening ties with its key trading partners."The non-hydrocarbon sector is expected to grow by 5.1% in 2025, according to the CBUAE.The hydrocarbon sector is also poised for a 3.6% expansion in 2025, followed by a further 8.5% growth in 2026.This is supported by gradual increases in oil production as OPEC+ lifts production cuts, in addition to ongoing and planned upstream and midstream oil and gas projects.The report also pointed out that the UAE's airports experienced a 10% increase in passenger traffic in 2024."Abu Dhabi Airports reported significant growth, handling 29.4 million passengers in 2024, a 28.1% increase from 2023, driven by network expansion, strategic partnerships, and a focus on delivering a world-class passenger experience," the report said."Abu Dhabi's expanding role as a leisure and business travel hub significantly contributes to the UAE's economic diversification efforts."Meanwhile, Dubai International Airport set a new record in 2024, welcoming 92.3 million passengers and surpassing its previous peak of 89.1 million in 2018.The UAE's tourism and aviation sectors remain key drivers of economic diversification, according to the report.The sustained growth in both sectors "reflects the success of planned initiatives aimed at enhancing connectivity, expanding hospitality infrastructure, and promoting the UAE as a global destination for leisure and business travel."The UAE banking sector remains resilient, with total assets reaching Dh4.56 trillion by the end of 2024.Lending grew by 9.5% year-on-year, driven by increased retail and corporate borrowing, while deposit growth reached 12.9% in Q4 2024.The insurance sector also demonstrated significant growth, with gross written premiums increasing by 21.4% year-on-year, and gross paid claims rising by 35.8%.The report also noted that the UAE government recorded a fiscal surplus of Dh96.3 billion (6.5% of GDP) in the first nine months of 2024, a 57.5% increase from the same period in 2023, driven by a 22.1% rise in tax revenues.Government capital expenditure increased by 15.4% year-on-year, reinforcing its commitment to infrastructure development and economic expansion.Inflation in the UAE remained well-controlled at 1.7% in 2024, significantly below the global average of 5.7%.The CBUAE maintained its 2025 inflation forecast for the UAE at 2.0%. Non-tradable components of the consumer basket are expected to be the main drivers, partially offset by moderating energy prices.The UAE's import sector reached Dh1.177 trillion in the first nine months of 2024, expanding by 12.9% year-on-year, with China, India, and the US as the top trading partners.
Gold remained a key trade commodity, accounting for 23.5% of total imports and 48.6% of total non-oil exports.
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The forum discussed ways to enhance the integration of climate policies in risk management and investments, and the necessity of finding effective solutions to strengthen the financial sector's resilience in facing future climate and environmental challenges. It also addressed frameworks for activating regional and international cooperation in the areas of legislation, financial policies, and adopting a proactive approach in developing sustainable Islamic finance solutions, in a step that affirms the UAE's growing position as a leading global centre in leading the dialogue on the future of sustainable finance. The forum's agenda included a number of themes in the field of sustainable finance, most notably strategies for integrating climate risks into regulatory frameworks, adaptation finance tools in emerging markets, and policies for enhancing the resilience of financial systems in the face of climate change. 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In his closing remarks, H.E Ebrahim Al Zaabi, Assistant Governor of Monetary Policy and Financial Stability at the CBUAE affirmed the forum's success in achieving its strategic objectives by providing a high-level platform for constructive dialogue and strengthening frameworks for joint cooperation among regulatory and financial entities to address climate-related challenges. He added: 'The fruitful discussions witnessed by the forum contributed to enhancing the understanding of current climate challenges and exploring promising prospects for building and developing a more resilient and integrated financial system, by expanding the base of partnerships and strengthening international cooperation.' 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