Heavy investments into projects will ally with reforms and other factors to boost growth in the UAE economy in the next two years, according to the Central Bank.

Real GDP growth is projected at 4.7 percent in 2025 and 5.7 per cent in 2026, the Central Bank said in its quarterly bulletin published this week.

The report noted that the UAE GDP, the second largest in the Arab world, expanded by 3.9 per cent  in 2024 due to strong performance of the tourism, transportation, financial and insurance services, construction and real estate, and communications sectors.

”For 2025, forecast growth has been revised up to 4.7 per cent due to the robust non hydrocarbon and hydrocarbon sectors,” the report said.

“Growth is projected at 5.7 per cent in 2026, supported by stronger hydrocarbon growth, based on the assumption that oil production is recovered in line with OPEC+ agreement.”

The Central Bank cautioned that growth this year could still be stifled by possible oil price weakness, regional tensions and escalating global trade policies.

 “Conversely, on the upside, the successful implementation of reforms, combined with diversification efforts, signed Comprehensive Economic Partnership Agreements, investment projects, and faster adoption of artificial intelligence in key sectors could boost economic performance.”

(Writing by Nadim Kawach; Editing by Anoop Menon)

(anoop.menon@lseg.com)

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