UAE c. bank projects 4.5% GDP growth in ’25
The UAE’s real GDP growth is forecast to reach 4.5 per cent in 2025, against 4.0 per cent in 2024, the Central Bank of the UAE (CBUAE) said in its recent statement on Tuesday.
The UAE’s non-oil trade exceeded AED 1.3 trillion in H1 2024, equivalent to 134 per cent of GDP—a 10.6 per cent year-on-year increase, and reflects a successful implementation of the plan to diversify the UAE economy and strengthen ties with key trading partners.
UAE Inflation and Real Estate Updates
The bank revised UAE inflation forecasts to 1.8 per cent for 2024 and 2.0 per cent for 2025. Real estate trends varied, with Dubai’s residential sales surging 34.3 per cent year-on-year (YoY) in the first nine months of 2024, while Abu Dhabi saw a 15.5 per cent decline in sales transactions.
Tourism and Transport
Dubai’s tourism sector continued its growth, with hotel occupancy reaching 76.4 per cent and 13.3 million overnight visitors recorded in the first nine months of 2024, a 7.0 per cent YoY increase. The transport sector expanded 12.6 per cent in the first eight months of 2024, further boosting the non-oil economy.
Resilient Banking and Financial Markets
The UAE’s banking sector showed resilience, with deposit growth at 14.1 per cent and loan portfolios expanding 9.1 per cent in Q3 2024. The CBUAE reduced its Base Rate to 4.65 per cent in November, reflecting easing monetary policy. Equity markets diverged, with Dubai’s index rising 6.4 per cent year-on-year, while Abu Dhabi’s fell 4.5 per cent.
Sustained Growth and Stability
Strong fiscal fundamentals, an expanding insurance sector, and effective economic policies reinforce the UAE’s position as a regional and global leader, with growth projected to remain robust through 2028.
Global Growth and Inflation Trends
The IMF forecasts steady global economic growth of 3.2 per cent for 2024 and 2025, while inflation continues to decline, allowing central banks to ease monetary policy gradually.
Advanced economies are expected to grow by 1.8 per cent, while emerging markets face a downgraded forecast of 4.2 per cent due to economic weaknesses and geopolitical challenges.
Attribution: Amwal Al Ghad English
Subediting: M. S. Salama
