UAE Economy to Grow 4.8% in 2025, Says World Bank
Introduction
The latest edition of the Gulf Economic Update 2025 (GEU) from the World Bank projects that the UAE economy will grow by 4.8% in 2025, making it the fastest-growing economy in the Gulf region this year.
The forecast highlights the UAE’s balanced growth across both oil and non-oil sectors, underpinned by rapid digital transformation, investment in infrastructure, and a diversified export base.
Why the Growth Forecast Matters
Balanced Oil & Non-Oil Growth
Unlike oil-dependent models, the UAE now shows strong performance in sectors like trade, tourism, real estate, technology and services. The World Bank notes that this diversification is a major reason behind the resilient 4.8% GDP growth forecast.
Digital Transformation as Growth Engine
The report emphasizes the role of digital innovation, AI adoption, and high-speed telecom infrastructure in driving economic diversification.
Investor Confidence & Economic Stability
Strong GDP growth projections can attract foreign investment, support business expansion, and offer broader economic stability — which is key for long-term planning, both for private and public sectors.
Leading the GCC in 2025 Growth
According to the GEU, the UAE at 4.8% growth tops the Gulf, ahead of regional peers like Saudi Arabia (3.8%), Bahrain (3.5%), Oman (3.1%), Qatar (2.8%) and Kuwait (2.7%) this year.
What to Watch: Opportunities & Challenges Ahead
Non-oil sectors expansion:
Continued growth in tourism, real estate, tech, fintech, logistics and services could drive medium-term economic stability.
Digital & AI-led innovation:
As UAE invests in digital infrastructure, sectors like AI, cloud, fintech and tech services may attract more talent, investment, and global collaborations.
Resilience to oil volatility:
Reliance on diversified sectors reduces vulnerability to global oil price swings, improving economic resilience.
Risk management:
Global economic headwinds, supply-chain disruptions or energy-sector fluctuations could still affect growth — balanced growth strategy remains crucial.
Conclusion
The World Bank’s 4.8% growth forecast for the UAE in 2025 is a strong endorsement of the country’s economic strategy — combining diversification, digital transformation, and balanced sector growth.
If executed well, this could reinforce the UAE’s position as a leading regional economic hub and a stable, attractive destination for global investment.
For residents, investors, and policymakers — the forecast signals optimism, opportunity.
