The UAE economy is poised for further growth in the second half of 2024, achieving significant advancements and exceptional accomplishments. This is thanks to a stable investment and economic environment that is capable of continuing to prosper despite global economic uncertainties.
Continued macroeconomic successes
The expected economic performance in 2024 is a continuation of last year’s successes, with positive growth rates observed across macroeconomic indicators. In 2023, the UAE’s GDP reached AED1.68 trillion, growing by 3.6 percent. Meanwhile, the non-oil GDP at constant prices was AED1.25 trillion, growing by 6.2 percent, placing the national economy fifth globally in the real GDP growth index.
Positive economic forecasts
Looking ahead, the World Bank forecasts a GDP growth of 3.9 percent for the UAE in 2024, with the expectation that it will rise further to 4.1 percent in 2025. Similarly, the International Monetary Fund (IMF) expects the national economy to grow by 4 percent in 2024, driven by strong activity in the tourism, construction, manufacturing, and financial services sectors.
Government’s proactive measures
Dr. Karim El Solh, co-founder and chief executive officer of Gulf Capital, believes the UAE’s economy is on an upward trajectory, bolstered by strong momentum over the past two years. He commended the UAE government’s proactive measures, such as stimulus packages, foreign investment incentives, and efforts to improve business ease, amid global economic challenges.
Factors attracting investors
According to Dr. El Solh, the UAE’s strategic location, robust infrastructure, and business-friendly policy have been key factors in attracting investors and fostering growth. He highlighted the UAE’s Vision 2030 framework and forward-looking economic policy, underscoring diversification, innovation, and sustainability, which have gained international acclaim and boosted confidence in the national economy.
Positive outlook
Damian Hitchen, CEO of Saxo Bank in the Middle East and North Africa, shares a similar outlook, expecting the UAE’s economy to grow by over 4 percent in 2024. This growth is anticipated to be driven by OPEC’s increased oil production quota and momentum in non-oil sectors. Hitchen also noted the UAE’s record $23 billion in foreign direct investment in 2022, reaching an all-time high, and the country’s 14th-place global ranking in attracting professional talent, according to the Boston Consulting Group.
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Diversification and sectoral performance
Vijay Valecha, chief investment officer at Century Financial, also anticipated the UAE’s economy will sustain robust growth exceeding 4 percent this year, supported by strong performances in non-oil sectors. He highlighted the UAE’s economic diversification away from oil, emphasizing sectors like renewable energy, technology, financial services, tourism, construction, and real estate, which collectively drive over 70 percent of the UAE’s GDP. Valecha predicted the UAE will lead the Gulf and Arab countries in economic performance in 2024, credited to its strategic initiatives and forward-looking policy.
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