Abu Dhabi Economy Grew by 3.3% Q1 2024

Abu Dhabi Economy in Q1 2024: A Strong Start to the Year

Abu Dhabi economy recorded a significant economic achievement in the first quarter of 2024. The emirate’s gross domestic product (GDP) grew by 3.3% compared to the same period in 2023. This growth has been predominantly driven by the robust performance of non-oil economic activities, according to the Statistics Centre – Abu Dhabi (SCAD).

Non-Oil Sector: A Key Contributor to GDP Growth

The non-oil sector emerged as a crucial driver of Abu Dhabi’s economic growth expanding by 4.7% in the first quarter. This growth is a result of the strong performance in various sectors, including transportation, construction, finance, accommodation and food services. The non-oil activities now contribute 54.1% to Abu Dhabi’s economy—the highest share recorded since 2015. The non-oil economy’s value reached AED 154.7 billion (USD 42.14 billion), highlighting the success of the government’s economic diversification policies.

This increase in the non-oil sector’s contribution is reflective of Abu Dhabi’s strategic focus on reducing its dependency on oil revenues and enhancing other sectors’ performance. The consistent growth of the non-oil sector is credited to the emirate’s resilience and its progress toward becoming a smart, diversified, and sustainable economy.

Strategic Policies and Investment Climate

Abu Dhabi’s steady economic growth is attributed to the emirate’s effective strategic policies and a favorable investment climate. Ahmed Jasim Al Zaabi, Chairman of the Abu Dhabi Department of Economic Development (ADDED), emphasized that the overall 3.3% rise in total GDP, along with the 4.7% growth in the non-oil sector, is a testament to the success of these policies. The positive outcomes in various non-oil sectors are a direct result of the government’s commitment to creating a diversified and sustainable economy, positioning Abu Dhabi as a leader both locally and internationally.

Abu Dhabi’s attractive investment climate has been particularly successful in drawing foreign investments into major non-oil activities, such as construction, which contributed 8.8% to the overall economy, exceeding AED 25 billion (USD 6.82 billion) in value.

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Sector-Specific Growth Highlights

Several sectors have shown impressive growth rates, further contributing to Abu Dhabi’s overall economic expansion in the first quarter of 2024. The construction sector, for instance, achieved a growth rate of 9.5%, contributing 8.8% to the economy, with a value exceeding AED 25 billion (USD 6.82 billion)—the highest in five years. The finance and insurance sector also recorded a 9.7% growth, making up 7% of the economy and marking a 39% increase in value over the past decade.

Additionally, the telecommunications sector saw a 5.9% growth rate, while the accommodation and food services sector increased by 6.2%. The transport and storage sector stood out with a notable 14.4% growth rate. Meanwhile, the manufacturing sector, though growing at a more modest rate of 1.7%, still made a significant contribution of 8.7% to GDP, with its value reaching AED 24.8 billion (USD 6.76 billion), representing a 102% increase over the past decade.

Strategic Initiatives and Future Outlook

Abu Dhabi’s continued economic success is largely driven by strategic initiatives aimed at diversification, industrial development, and attracting foreign investments. These initiatives have significantly boosted the non-oil sector’s performance, which exceeded 9.1% in 2023. The emirate’s leadership in these areas has not only solidified its position on the global stage but has also set the foundation for sustained economic growth in the years to come. This has resulted in a massive improvement in the Quality of Life Index as Abu Dhabi was ranked the top city in regional rankings and 24th in 2023 globally. 

As Abu Dhabi progresses through 2024, the focus on enhancing its non-oil economy, increasing GDP, boosting non-oil exports and expanding the tourism sector’s contribution to the economy remains central to its economic strategy. Last year, the Abu Dhabi Chamber announced new strategies to bolster economic growth and support private sectors in a competitive business environment. These efforts are expected to continue driving growth and further strengthening Abu Dhabi’s position as a leading global economy.