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Source: Freepik
Published on 12/21/2024

UAE GDP to Grow 5% in 2025, Driven by Non-Oil Sectors

Consumer Spending Up, Inflation Eases as Tourism and Migration Boost Economy

The UAE's economy is projected to grow by 5% in 2025 outpacing global growth of 3.2%. The expansion will be fueled by strong non-oil economic activity, supported by government-led diversification and infrastructure investments. Private sector investment boosted by lower interest rates and population growth will further drive domestic consumption.

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Consumer spending is expected to rise by 4.3% while inflation is forecast at 2.3%. Tourism and public investment will continue to support non-oil GDP growth with the GCC region outperforming global markets. However, consumers may prioritize affordable goods and experiences due to rising prices.

Migration has contributed significantly to the UAE's population growth and remittances from expats are expected to continue growing, benefiting developing economies. The UAE also sees an increase in women’s labor force participation which is positively impacting economic consumption.