UAE GDP Expected To Increase By 4.1% In 2025 According To World Bank Report

The World Bank's latest MENA Economic Update predicts the UAE's GDP will grow by 3.3% in 2024, increasing to 4.1% in 2025. The report, titled "Growth in the Middle East and North Africa," highlights that the UAE will lead with real GDP per capita growth rates of 2.5% in 2024 and 3.4% in 2025, driven by strong non-oil sector growth.

The UAE's current account surplus is anticipated to decrease to 7.5% of GDP in 2024 from 9.2% in 2023, despite ongoing diversification efforts. Fiscal surpluses are expected to remain at 4.9% of GDP in 2024 and slightly lower at 4.7% in 2025, according to the report.

Overall, MENA's GDP growth is projected to increase modestly to 2.2% in real terms for 2024, up from 1.8% in the previous year. This rise is largely attributed to the Gulf Cooperation Council (GCC) countries, where growth is expected to improve from a mere 0.5% in 2023 to a more robust 1.9% in 2024 and further to 4.2% by 2025.

In contrast, other parts of MENA are likely to see slower growth rates. For oil importers, growth is forecasted to decline from 3.2% in 2023 to just over two percent in the following year. Similarly, non-GCC oil exporters are expected to experience a reduction from a growth rate of around three percent down to approximately two and a half percent.

Looking ahead to the year after next, MENA as a whole is predicted to grow at a rate of nearly four percent by then. Meanwhile, GCC nations are set for stronger economic performance with an anticipated growth rate climbing above four percent by that time.

GCC and Oil Exporters' Projections

The report also forecasts that developing oil-exporting countries will see their growth rates reach about two and a half percent next year while developing oil-importing nations might witness slightly lower figures around two percent during the same period.

The UAE remains poised for continued economic strength through its diversified strategies despite some challenges ahead regarding account surpluses or fiscal balances over coming years as outlined within this comprehensive analysis provided by World Bank experts today.

With inputs from WAM