UAE Economic Growth Forecast 2025: IMF Projects Strong Momentum

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UAE Poised for Strongest Growth in the Gulf, IMF Forecasts

The UAE economic growth forecast 2025 signals a period of remarkable expansion, with the nation cementing its reputation as one of the world’s most dynamic and resilient economies. 

According to the latest UAE economic growth forecast 2025  by the IMF, the nation’s real GDP is expected to expand by 4.8%, up from earlier forecasts of 4%, with growth accelerating to 5% in 2026. This upgraded outlook highlights the nation’s success in sustaining momentum through economic diversification, sound policy measures, and investor confidence, factors that are expected to underpin the highest growth in UAE consumer spending globally next year.

Abu Dhabi and Dubai Leading Growth

Abu Dhabi’s economy is expected to grow by around 6% in 2025, while Dubai’s growth is projected at 3.4%, according to a WAM report quoting Dr Jihad Azour, Director of the Middle East and Central Asia Department at the IMF. The figures were shared by the Dubai International Financial Centre (DIFC) in partnership with the IMF, under the title “IMF Regional Economic Outlook: Middle East and North Africa Report.

Dr Azour noted that UAE’s growth is driven by the resilience of its non-oil sectors particularly tourism, financial services, and real estate alongside benefits from increased oil production as OPEC+ supply restrictions ease.

Abu Dhabi benefits from rising oil output as well as strong performance in sectors like services and real estate. Dubai, meanwhile, continues to thrive as a global tourism and financial hub, while also emerging as the top choice for AI startups, a trend further fueled by its rapidly growing population, which is set to reach 4 million in 2025.

The country’s appeal extends beyond business and investment, with the UAE recognized in the Best Cities for Digital Nomads 2025, where Dubai tops the Nomad Index and Abu Dhabi ranks second.

Diversification Driving Growth Momentum

Economic diversification remains central to the UAE’s resilience. Over the past year, non-oil sectors including tourism, finance, logistics, and real estate have emerged as key growth engines. 

In Abu Dhabi, property transactions jumped by more than 40% in the first half of 2025. It reflects the sector’s impressive surge of AED 54 billion in deals, and showcases robust demand from investors and residents. On similar lines, the Dubai real estate sector is expected to grow with initiatives like Strategic Plan 2026. The strong real estate activity also mirrors population growth, expanding infrastructure, and confidence in the market’s long-term fundamentals.

Also Read: AI in Real Estate: How Automation is Shaping the UAE’s Property Sector

Strong Foundations and Strategic Investments

As highlighted in the UAE economic growth forecast 2025, the nation’s macroeconomic strength is built on stable fiscal policy, robust capital markets, and ambitious strategies such as We the UAE 2031 and the Dubai Economic Agenda D33. Government-led investments in technology, energy transition, and logistics infrastructure are expected to sustain growth well into the next decade. The country’s strong focus on innovation and technology, coupled with its ambition to become a global leader in artificial intelligence, continues to attract international attention and long-term investment.

Analysts note that this alignment of policy, innovation, and diversification positions the UAE as one of the world’s most attractive destinations for capital and talent. With both Abu Dhabi and Dubai expanding above global averages, the nation is reinforcing its position as a regional economic powerhouse and a safe haven for investors seeking growth with resilience. These efforts are further complemented by a thriving startup ecosystem and evolving consumer trends in Dubai, reflecting the UAE’s broader strategy to strengthen its competitiveness and sustain inclusive, innovation-driven growth.

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