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Home Economy Abu Dhabi’s economy to grow 4.2 percent in 2025, 5.8 percent in 2026: IMF

Abu Dhabi’s economy to grow 4.2 percent in 2025, 5.8 percent in 2026: IMF

Dubai's economy is projected to expand by 3.3 percent in 2025, increasing to 3.5 percent in 2026
Abu Dhabi’s economy to grow 4.2 percent in 2025, 5.8 percent in 2026: IMF
On the national level, the UAE is set to witness the highest growth at 4 percent in 2025 and 5 percent in 2026

The International Monetary Fund (IMF) expects Abu Dhabi’s economy to grow by 4.2 percent in 2025 and accelerate to 5.8 percent in 2026. Meanwhile, Dubai’s economy is projected to expand by 3.3 percent in 2025, increasing to 3.5 percent in 2026.

In a media briefing organized by the Dubai International Financial Center and the IMF, Jihad Azour, director of the Middle East and Central Asia department at the IMF, said he expects the UAE economy to grow by 4 percent in 2025.

The media briefing also saw the release of the IMF’s latest regional outlook report, in which it cut its growth forecast for the Middle East and North Africa (MENA) region to 2.6 percent in 2025, marking a sharp downgrade from its October projection of 4 percent growth.

“Rising trade tensions and exceptional global policy uncertainty are adding to the impact of conflicts and extended oil production cuts to weaken growth prospects for the region,” said the IMF.

Non-oil sector to drive UAE’s growth

Azour attributed the sustained growth forecast for the UAE, despite downward revisions in many other countries, to the strong performance of its non-oil sector, infrastructure investments and expansion in key areas like real estate and finance. He further anticipates growth to accelerate to 5 percent in 2026.

Azour also emphasised that the GCC states do not have identical economic structures or reserve levels, which makes their responses to global market fluctuations varied.

He added that the average growth of the MENA region’s economies reached 1.8 percent in 2024 and is expected to rise to 2.6 percent in 2025 and 3.4 percent in 2026. These figures represent a downward revision from the October 2024 estimates, which had projected growth of 4 percent for 2025 and 4.2 percent for 2026.

In the report, the IMF said it expects GCC economies to grow 3 percent in 2025 and 4.1 percent in 2026. On the national level, the UAE is set to witness the highest growth at 4 percent in 2025 and 5 percent in 2026. Meanwhile, Saudi Arabia is set to grow 3 percent in 2025 and 3.7 percent in 2026.

Abu Dhabi economy
Jihad Azour, director of the Middle East and Central Asia department at the IMF (Source: WAM)

Read: IMF cuts MENA 2025 growth forecast to 2.6 percent as global policy uncertainty looms

Abu Dhabi’s economy grows 3.8 percent in 2024

Abu Dhabi’s strong growth forecast comes after the emirate’s economy expanded by 3.8 percent in 2024, reaching an all-time high value of $326.71 billion, according to preliminary statistical estimates by the Statistics Center – Abu Dhabi (SCAD).

The emirate witnessed significant annual economic growth driven by the thriving non-oil sector, which recorded a strong growth rate of 6.2 percent, marking its highest-ever annual contribution of 54.7 percent to total GDP.

In the fourth quarter of 2024, Abu Dhabi’s GDP grew by 4.4 percent, while the non-oil GDP expanded by 6.6 percent, maintaining its record-high contribution of 54.7 percent to total GDP. The 2024 GDP data highlights Abu Dhabi’s sustained economic momentum, with total GDP and non-oil GDP reaching record values for the third consecutive year.

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