The UAE continues to solidify its position as a global powerhouse in Islamic finance and the halal industry, as part of a wider national strategy aimed at economic diversification and enhancing global competitiveness.
Backed by progressive government policy, a robust regulatory environment, and world-class infrastructure, both sectors are experiencing accelerated growth in the UAE. Central to this transformation is the UAE’s pivot toward a knowledge- and innovation-driven economy, where Sharia-compliant finance and halal production are seen as key pillars.
National strategy drives sectoral integration
In May 2025, the UAE unveiled a comprehensive national strategy to advance Islamic finance and the halal economy. The plan aims to develop an integrated ecosystem for Islamic banking, Takaful (Islamic insurance), Sukuk (Islamic bonds), and other non-banking services, in alignment with international standards.
Jamal Saleh, director-general of the UAE Banks Federation (UBF), emphasized the UAE’s bold and far-reaching vision to elevate the role of the Islamic economy on national, regional, and global levels. According to the state news agency (WAM), Saleh described this initiative as a critical step in embedding Islamic finance into the country’s broader economic transformation.
He credited the UAE’s strong and resilient financial systems for enabling the rapid growth of Sharia-compliant financial services, aligned with the nation’s economic diversification and innovation-led goals. Saleh also highlighted the country’s significant achievements in Sukuk issuance and the development of non-banking Islamic financial services.
According to February 2025 data from the Central Bank of the UAE (CBUAE), Islamic banks now hold 18 percent of total banking assets and account for 22.8 percent of total credit in the national banking sector. Total credit extended by Islamic banks reached AED 503.5 billion, a 16 percent increase year-on-year, with private sector credit at AED 350.4 billion, growing 13.2 percent. Deposits at Islamic banks surged to AED 595.3 billion, marking a 16.9 percent annual growth rate.
Islamic finance sector records strong growth
The Islamic Sukuk market is also flourishing. The federal government’s launch of dirham-denominated Treasury Sukuk (T-Sukuk) in 2023 marked a new chapter for Sharia-compliant fixed-income instruments.
Today, the UAE is one of the largest Sukuk listing centres globally, with Nasdaq Dubai hosting over $95.7 billion in Sukuk as of May 2025. The UAE ranked fourth globally in Islamic financial market assets, according to the 2023 Islamic Finance Development Indicator.
Halal industry positioned for massive expansion
In tandem with growth in finance, the UAE is rapidly emerging as a global halal manufacturing and export hub. Under the national strategy, the country aims to increase halal exports from AED 74 billion to AED 315 billion by 2031.
Saleh Lootah, chairman of the UAE Food and Beverage Manufacturers Group, described this as a milestone initiative in positioning the UAE as a global centre for halal production. He emphasized its potential to unlock new growth opportunities and reinforce the country’s leadership in the halal industry.
Lootah also noted a surge in interest among local manufacturers eager to expand into the sector, driven by rising global demand for halal-certified goods and a growing consumer focus on ethical and religious standards, according to the state news agency.
A Bonafide Research report forecasts that the UAE’s halal food and beverage market will exceed $31.27 billion by 2029, reflecting the robust demand for religiously compliant products both locally and internationally.
Strategic location and vision fuel growth
The UAE’s strategic position as a gateway between East and West, combined with its global trade infrastructure and regulatory clarity, makes it an ideal base for both halal commerce and Islamic financial services.
With strong government backing, modern regulatory frameworks, and targeted development strategies, the UAE is not only strengthening its domestic capabilities but also reshaping its influence across the global Islamic economy.
As both sectors continue to grow, the UAE is well-positioned to lead the next era of innovation in Islamic finance and halal trade on the world stage.
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