Latest news with #nonoilsectors
Zawya
10 hours ago
- Business
- Zawya
World Bank expects 4.9% growth for UAE economy in 2026, 2027
The World Bank has projected that the UAE's economic growth will continue on an upward trajectory, reaching 4.6 percent in 2025 and stabilising at 4.9 percent during 2026 and 2027. The World Bank confirmed that the UAE's non-oil sectors continue to play a key role as a main driver of growth, with an expected growth rate of 4.9 percent in 2025. According to the latest edition of the Gulf Economic Update (GEU) issued by the World Bank, which is based on information available as of 1st June, economic growth in the GCC countries is expected to rise in the medium term, reaching 3.2 percent in 2025 and 4.5 percent in 2026. According to the World Bank, strong expansion in non-oil sectors is contributing to the growth achieved by Gulf economies. According to the latest edition of the GEU, the region witnessed notable economic growth of 1.7 percent in 2024, compared to 0.3 percent in 2023. The report noted that the non-oil sector continued to demonstrate its resilience, with a 3.7 percent increase. This growth was significantly driven by private consumption, investment, and structural reforms implemented in GCC countries. In Bahrain, growth is expected to stabilise at 3.5 percent in 2025, while economic growth in Kuwait is expected to recover significantly and reach 2.2 percent in 2025. Growth in the Sultanate of Oman is expected to gradually accelerate to 3 percent in 2025, compared to 1.7 percent in 2024, 3.7 percent in 2026, and 4 percent in 2027. The report expects economic growth in Qatar to remain stable at 2.4 percent in 2025, compared to 2.6 percent in 2024, before accelerating to an average of 6.5 percent in 2026–2027. In the Kingdom of Saudi Arabia, the World Bank report expects economic growth to continue recovering to 2.8 percent in 2025 and reach an average of 4.6 percent in 2026–2027. The World Bank report also highlighted the challenges associated with uncertainty surrounding global trade, noting that the risk of a global economic slowdown continues to negatively impact the region. It recommended accelerating reforms aimed at diversifying economic activity and enhancing regional trade to mitigate these risks in GCC countries. Safaa El Tayeb El-Kogali, Division Director for the GCC countries at the World Bank, said 'The resilience of GCC countries in navigating global uncertainties while advancing economic diversification underscores their strong commitment to long-term prosperity.' She added, ""Strategic fiscal policies, targeted investments, and a strong focus on innovation, entrepreneurship, and job creation for youth are essential to sustaining growth and stability." The report titled "Smart Spending, Stronger Outcomes: Fiscal Policy for a Thriving GCC', discusses the effectiveness of fiscal policy in ensuring macroeconomic stabilization and encouraging growth. The topic is particularly relevant as oil price fluctuations strain budget balances in several countries across the region. The report finds that government spending in the GCC region has effectively stabilized economies, especially during recessionary episodes. The findings show that a 1-unit increase in fiscal spending can boost non-hydrocarbon output by 0.1-0.45 units in the region.
Zawya
2 days ago
- Business
- Zawya
VIDEO: GCC economies buck global downturn; GDP to hit 4.4% in 2025
The stronger-than-expected growth will be driven primarily by higher oil output and robust non-oil sectors, especially in the region's two largest economies, the UAE and Saudi Arabia. Watch the Zawya video here:
Khaleej Times
4 days ago
- Business
- Khaleej Times
Non-oil sector propels UAE's GDP to nearly Dh1.8 trillion in 2024
The UAE's economy registered a growth of 4.0 per cent in real gross domestic product (GDP) in 2024, reaching Dh1.776 trillion, underscoring the resilience and dynamism of the country's non-oil sectors in the face of a challenging global environment. According to official data released by the Federal Competitiveness and Statistics Centre (FCSC) on Sunday, non-oil activities contributed an impressive 75.5 per cent to the national economy, amounting to Dh1.342 trillion, while oil-related GDP stood at Dh434 billion. The upbeat data has reinforced confidence in the UAE's long-term economic trajectory, driven by structural reforms, increased investment in non-oil sectors, and strategic initiatives under the 'We the UAE 2031' vision. The Ministry of Economy described the growth as a testament to the country's effective economic diversification strategy and its transformation into a knowledge- and innovation-driven economy. Minister of Economy Abdulla bin Touq Al Marri said the performance reflects the UAE's determination to build a sustainable, globally competitive economy. 'Each milestone brings us closer to our national goal of raising the GDP to Dh3 trillion by the next decade,' said Al Marri. 'We are committed to positioning the UAE as a global hub for the new economy by reinforcing sustainable development, leveraging emerging technologies, and enhancing international competitiveness.' Hanan Mansour Ahli, managing director of the FCSC, noted that the 4.0 per cent GDP growth 'mirrors the UAE's strategic foresight and focus on sustainable, non-oil-driven growth,' with diversified economic activity enhancing social well-being and national resilience. Among the fastest-growing contributors to GDP in 2024 was the transport and storage sector, which recorded a remarkable 9.6 per cent year-on-year growth, powered by a strong rebound in aviation and logistics. UAE airports handled a total of 147.8 million passengers during the year, a 10 per cent increase from 2023, reflecting the country's recovery as a global travel and logistics hub. The construction and real estate sectors also continued their upward momentum. The building and construction sector posted an 8.4 per cent increase, buoyed by robust infrastructure development across urban centres, while real estate activities grew by 4.8 per cent amid rising demand for residential and commercial properties. Financial and insurance services expanded by 7.0 per cent, reflecting strong capital inflows and healthy banking sector performance. The hospitality and food services sector grew by 5.7 per cent, supported by a surge in tourist arrivals and high hotel occupancy levels throughout 2024. In terms of sectoral contributions to the non-oil GDP, wholesale and retail trade led the way with a 16.8 per cent share, followed by manufacturing (13.5 per cent), financial and insurance activities (13.2 per cent), construction (11.7 per cent), and real estate (7.8 per cent). These indicators collectively signal a broad-based expansion across key pillars of the non-oil economy. The International Monetary Fund (IMF) echoed the optimism in its latest regional economic outlook, projecting that the UAE will maintain strong medium-term growth thanks to its effective policy mix and strategic diversification plans. The IMF said the UAE's fiscal and monetary policies, alongside targeted reforms in labour markets, green energy, and digital transformation, would underpin continued economic stability and competitiveness. The Central Bank of the UAE, in its most recent economic review, reaffirmed its growth forecast for 2024, noting that the non-oil sector remains the main engine of economic momentum. The apex bank said it expects the non-oil economy to grow by around 5.4 per cent in 2025, supported by steady domestic demand, robust trade activity, and rising levels of foreign direct investment (FDI). Analysts also highlight that the UAE's proactive steps toward climate resilience and hosting of global events such as COP28 have elevated its stature as a responsible economic player, further accelerating investment in green technologies, logistics, advanced manufacturing, and tourism infrastructure. Analysts added that as global headwinds from inflationary pressures and geopolitical uncertainties persist, the UAE's diversified economic model and prudent policy framework appear well-positioned to deliver sustainable growth and opportunity across sectors. With its ambitious vision to double the size of the economy by 2031, the UAE is increasingly seen as a model of modernisation and economic agility in the Arab Gulf region, they noted.
Asharq Al-Awsat
10-06-2025
- Business
- Asharq Al-Awsat
Saudi Arabia Revises Q1 Economic Growth Estimate Up to 3.4%
Saudi Arabia's General Authority for Statistics has revised its annual economic growth figures for the Kingdom for the first quarter of 2025 to 3.4%, up from a preliminary estimate of 2.7% released in May, underscoring the resilience of non-oil sectors in driving economic momentum. Seasonally adjusted data showed real gross domestic product (GDP) grew 1.1% in the first quarter compared to the final three months of 2024, according to the updated figures. The figures showed non-oil activities as the true driver behind Saudi Arabia's economic expansion. Non-oil sectors surged 4.9% year-on-year, up from 4.2% in the May preliminary reading, and grew 1.0% quarter-on-quarter, contributing 2.8 percentage points to overall real GDP growth. This robust growth reflects the impact of massive government investments in infrastructure projects and development initiatives, alongside efforts to boost the private sector. In contrast, oil sector activities saw a slight decline of 0.5% year-on-year and 1.2% quarter-on-quarter, primarily due to the Kingdom's voluntary production cuts. Despite this contraction, the negative impact on overall growth remained limited to just 0.1 percentage points, underscoring the economy's ability to offset oil sector weakness through other areas. Government activities also recorded solid growth, rising 3.2% year-on-year and 5.5% compared to the previous quarter. Most non-oil economic activities recorded robust positive growth rates in the first quarter of 2025. Wholesale and retail trade, restaurants, and hotels posted the highest growth at 8.4% year-on-year, reflecting a booming tourism and entertainment sector alongside rising private consumer spending. Transport, storage, and communications grew by 6.0% year-on-year, highlighting advancements in the Kingdom's logistics and digital infrastructure. Financial services, insurance, and business services expanded 5.5% year-on-year, indicating maturation of the financial and service sectors. The data underscore the pivotal role of government investments and consumer spending in sustaining this growth. Gross fixed capital formation rose 8.5% annually, signaling continued funding for major projects and urban development. Meanwhile, government final consumption expenditure increased by 5.2%, with private final consumption up 4.5% year-on-year. Non-oil exports, including re-exports, surged 13.4% year-on-year in Q1 2025, while oil exports declined 8.4% over the same period, according to official figures released in May. These revised estimates come amid efforts by the General Authority for Statistics to align closely with international standards and enhance data quality. The authority undertook a comprehensive update of GDP estimates, applying the global moving-average methodology and collecting detailed 2023 data through expanded statistical surveys, ensuring accuracy and reliability. This strong non-oil-driven growth highlights Saudi Arabia's economic resilience and adaptability in a changing global landscape, reinforcing its steady path toward the ambitious goals of Vision 2030. In its latest World Economic Outlook report, the International Monetary Fund (IMF) forecast Saudi Arabia's GDP growth at 3.0% for 2025, a downward revision from its January estimate of 3.3%. The IMF also cut its 2026 growth forecast by 0.4 percentage points to 3.7%. Jihad Azour, IMF Director for the Middle East and Central Asia, told Asharq Al-Awsat last month that Saudi Arabia's economic resilience enables it to weather fluctuations in global oil prices. He noted the Kingdom's substantial financial reserves provide a strong buffer against external shocks. These reserves, combined with ongoing structural reforms under Vision 2030, have significantly strengthened Saudi Arabia's capacity to adapt. Azour added that reforms have not only bolstered economic resilience but also effectively diversified income sources and increased the contribution of non-oil sectors to GDP. This shift toward developing promising sectors reduces reliance on oil revenues and fosters sustainable new economic opportunities.
