The Central Bank of the United Arab Emirates (CBUAE) has maintained its real GDP growth projections for 2024 at 4.0 percent. The growth is expected to accelerate to 4.5 and 5.5 percent in 2025 and 2026, respectively.

 

According to the Quarterly Economic Review - December 2024 issued on Monday by the CBUAE, growth expectations for the current year are driven by growth in the tourism, transportation, financial and insurance services, construction and real estate, as well as communication sectors, said a Wam news agency report.

 

Non-oil GDP growth accelerated to 4.8 percent year-on-year (YoY) in Q2 2024, up from 4.0 percent YoY in the previous quarter, mainly due to the faster growth in manufacturing, trade, transportation and storage, and real estate activities.

 

Non-oil GDP growth is expected to remain strong at 4.9 percent in 2024 and 5.0 percent in 2025, resulting mainly from the strategic plans and policies implemented by the government to attract foreign investments and promote economic diversification.

 

The 16 non-oil sectors continued their steady growth pattern in Q3 2024. Wholesale and retail trade, manufacturing and construction continued to be some of the backbones of the growth in the non-oil sector.

 

The manufacturing sector, continued to attract more FDI, expanding in line with the different Emirates’ and Federal strategies. The first nine months of 2024 also saw strong growth in the construction sector.

 

The comprehensive economic partnership agreements (CEPA) signed by the UAE with many countries have also strengthened its trade partnerships. As a result, the UAE's non-oil trade exceeded AED1.3 trillion in H1 2024, equivalent to 134 percent of the country's GDP, representing a 10.6 percent YoY increase, and reflecting a successful implementation of the plan to diversify the UAE economy and strengthen ties with key trading partners.

 

In the first 10 months of 2024, oil production averaged 2.9 million barrels per day, and is expected to grow by 1.3 percent in 2024, accelerating to 2.9 percent in 2025.

 

The UAE fiscal sector performance during the first half of 2024 remained robust, with notable improvements in government revenue and fiscal surplus compared to the same period in 2023. The fiscal surplus reached AED65.7 billion, equivalent to 6.7 percent of GDP, representing a 38.8 percent increase from AED47.4 billion (5.1 percent of GDP) recorded in H1 2023.

 

General government revenue in H1 2024 rose by 6.9 percent YoY to AED263.9 billion, or 26.9 percent of GDP, driven by a substantial 22.4 percent YoY increase in tax revenues.

 

General government capital expenditure surged by 51.7 percent YoY to AED11 billion in the first half of 2024, reflecting the UAE government’s commitment to advancing largescale infrastructure projects and strengthening the country's economic and investment landscape.

 

Economic activity in the UAE’s non-oil private sector continues to expand, reflecting sustained business confidence in the country’s economic outlook.

 

In October 2024, the UAE’s Purchasing Managers’ Index (PMI) reached 54.1, indicating continued optimism among local companies, fuelled by expectations of continued demand and sales, which are expected to support consistent growth in output. Furthermore, the forecast of upcoming initiatives and investments reinforces this positive outlook.

 

In Dubai, the PMI stood at 53.2 in October 2024, aligning closely with the UAE’s overall index and signalling continued growth within the emirate’s non-oil private sector.

 

The number of employees covered by the CBUAE Wages Protection System (WPS) increased by 4.0 percent YoY in September 2024, while the average employee salary increased by 7.2 percent YoY. These indicators of employment and wage growth point to robust domestic consumption and sustainable GDP growth going forward.