This prominence is due to the country’s successful economic diversification and reduced reliance on oil
Roberta Gatti, chief economist for the Middle East and North Africa (MENA) region at the World Bank, expressed strong optimism regarding the continued expansion of the UAE’s economy in 2024 and 2025. In comments made to the Emirates News Agency (WAM) during the announcement of the World Bank Group’s partnership with the Abu Dhabi Global Market Academy—aimed at enhancing financial literacy, economic understanding, and sustainable development in the region—Gatti underscored the UAE’s significant position as a regional center for trade, business, and tourism. This prominence is attributed to the country’s successful economic diversification and diminished dependence on oil resources.
Projected GDP growth rates
Gatti projected that the UAE’s GDP will increase by 3.4 percent in 2024, with the expectation of ongoing fiscal and monetary surpluses in the medium term. She also highlighted that the average growth rate for the MENA region is anticipated to reach 2.2 percent in 2024, which marks a modest rise from the previous year’s 1.8 percent. However, this figure remains one percentage point lower than the average growth recorded prior to the COVID-19 pandemic.
GCC economies driving regional growth
The World Bank’s Chief Economist linked the region’s growth trajectory to the performance of the Gulf Cooperation Council (GCC) economies, which are forecasted to achieve a growth rate of 1.9 percent in 2024, a notable increase from 0.5 percent in 2023. This growth is expected to be bolstered by the expansion of the non-oil sector across most GCC economies. Gatti further predicted that GCC growth could accelerate to 4.2 percent in 2025, with developing oil-exporting nations anticipated to grow by 3.3 percent and developing oil-importing nations by 3.5 percent during the same period.
Role of women in economic prosperity
Additionally, Gatti stressed the vital role of women’s participation in the economy as a key factor in fostering prosperity within the MENA region. She pointed out that closing the gender employment gap could potentially boost the region’s GDP per capita by 51 percent.
According to the latest semi-annual MENA Economic Update from the World Bank, the UAE’s GDP is projected to grow by 3.3 percent in 2024, increasing to 4.1 percent in 2025. Titled “Growth in the Middle East and North Africa,” the report, released in October, indicates that the UAE is likely to lead in real GDP per capita growth rates, with expected increases of 2.5 percent in 2024 and 3.4 percent in 2025, primarily fueled by strong growth in the non-oil sector.
Current account and fiscal surplus projections
The report also forecasts a decline in the UAE’s current account surplus to 7.5 percent of GDP in 2024, down from 9.2 percent in 2023, even as diversification efforts continue. It predicts that the UAE will maintain fiscal surpluses of 4.9 percent of GDP in 2024 and 4.7 percent in 2025.
For 2025, MENA is expected to grow at a rate of 3.8 percent. Growth among GCC countries is projected to strengthen to 4.2 percent in 2025, up from 1.9 percent in 2024. Developing oil exporters are expected to see growth of 2.7 percent in 2024, while developing oil importers will likely experience growth of 2.1 percent.
Overall MENA GDP growth expectations
The report anticipates a modest overall GDP growth for the region, rising to 2.2 percent in real terms in 2024, up from 1.8 percent in 2023. This increase is largely driven by the GCC countries, where growth is expected to rise from 0.5 percent in 2023 to 1.9 percent in 2024 and further to 4.2 percent in 2025. Conversely, growth in the remainder of the MENA region is expected to slow. Oil importers are predicted to see growth decrease from 3.2 percent in 2023 to 2.1 percent in 2024, while non-GCC oil exporters are projected to experience a decline from 3.2 percent to 2.7 percent.