World Bank Optimizes GCC Growth Forecast For 2025, Projects 4.7% Increase
The World Bank has updated its economic growth forecast for the Gulf Cooperation Council (GCC) region, projecting a 4.7% growth rate for 2025, up from the earlier estimate of 3.8% published in April. However, this year's growth is now anticipated to be 2.8%, a decrease from the previous forecast of 3.6%, according to the Spring 2024 Gulf Economic Update (GEU) released on Wednesday.
The report highlighted that the GCC's economic outlook remains positive, driven by the anticipated recovery in oil production and a robust non-oil economy. OPEC+ members are expected to gradually ease production quotas in the latter half of the year, supporting this rebound. Concurrently, the non-oil sector is projected to sustain significant growth over the medium term.
In terms of fiscal health, the region's fiscal surplus is predicted to narrow to 0.1% of GDP this year. Meanwhile, the current account surplus is expected to reach 7.5% of GDP, compared to 8.4% in 2022. These adjustments reflect the dynamic economic environment and efforts to balance growth with fiscal stability.
The UAE's real GDP is forecast to accelerate to 3.9% this year, as per the World Bank, whereas Saudi Arabia is expected to achieve a 2.5% growth in 2024 and 5.9% in 2025. These figures underscore the region's diverse economic drivers and strategic initiatives aimed at bolstering growth.
The GEU report underscores the resilience of the GCC economies amid fluctuating global economic conditions, highlighting the importance of both oil and non-oil sectors in sustaining long-term economic stability and growth.
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