UAE Economy Poised For Exceptional Growth In 2024 With Strong Sector Performance

The UAE's economy is poised for further growth in the latter half of this year, achieving significant milestones due to a stable investment and economic environment. This stability allows continued prosperity despite global economic uncertainties. The anticipated performance in 2024 builds on last year's successes, with positive growth rates across various macroeconomic indicators.

In 2023, the UAE's GDP reached AED1.68 trillion, marking a 3.6 percent increase. The non-oil GDP at constant prices was AED1.25 trillion, growing by 6.2 percent, positioning the national economy fifth globally in the real GDP growth index. The World Bank predicts a GDP growth of 3.9 percent for the UAE, which is expected to rise to 4.1 percent in 2025.

Meanwhile, the International Monetary Fund (IMF) forecasts the national economy to grow by 4 percent in 2024. This growth is driven by strong activity in sectors such as tourism, construction, manufacturing, and financial services.

Dr. Karim El Solh, Co-Founder and Chief Executive Officer of Gulf Capital, believes the UAE's economy is on an upward trajectory due to strong momentum over the past two years. He praised the UAE government's proactive measures like stimulus packages and foreign investment incentives amid global economic challenges.

El Solh highlighted that the UAE's strategic location, robust infrastructure, and business-friendly policies are key factors attracting investors and fostering growth. He also noted that the Vision 2030 framework and forward-looking economic policy have gained international acclaim.

Foreign Investment and Talent Attraction

Damian Hitchen, CEO of Saxo Bank in the Middle East and North Africa, expects the UAE's economy to grow by over 4 percent in 2024. This growth is driven by OPEC's increased oil production quota and momentum in non-oil sectors. Hitchen pointed out that the UAE attracted a record $23 billion in foreign direct investment in 2022.

Additionally, according to the Boston Consulting Group, the UAE ranks 14th globally in attracting professional talent. Hitchen emphasised that tourism and aviation sectors play crucial roles in boosting the economy and transforming the UAE into a global transportation hub.

Diversification Efforts

Vijay Valecha, Chief Investment Officer at Century Financial, anticipates that the UAE's economy will sustain robust growth exceeding 4 percent this year. This growth is supported by strong performances in non-oil sectors such as renewable energy, technology, financial services, tourism, construction, and real estate.

Valecha underscored that these sectors collectively drive over 70 percent of the UAE's GDP. He predicted that strategic initiatives and forward-looking policies will enable the UAE to lead Gulf and Arab countries in economic performance in 2024.

The consistent efforts towards diversification away from oil have been pivotal for sustained economic growth. The focus on innovation and sustainability has boosted confidence among investors globally.

The positive outlook for the UAE’s economy reflects its resilience and adaptability amidst global challenges. The strategic initiatives undertaken are expected to continue driving growth across various sectors well into 2025.

With inputs from WAM