UAE GDP and economy to grow by 4% in 2025 - IMF

UAE GDP and Economy Outlook 2025

The UAE GDP and economy are expected to grow around 4% in 2025 according to a recent publication issued by the International Monetary Fund (IMF). Moreover, the IMF’s forecast for the UAE in 2025 aligns with the World Bank’s projection of 4% GDP growth.

Despite geopolitical tensions and significant drops in oil prices, the UAE’s GDP and economy remain strong and resilient, ensuring a positive economic outlook for 2025. The IMF report further stated that the country’s financially strong position will enable it to continue supporting large investments in infrastructure and artificial intelligence (AI) projects, thereby ensuring productivity and economic growth. In addition, UAE consumer spending intentions are also set to see a 13% increase in 2025 with most notable spending in apparel, groceries, and retail sectors. 

Read: UAE Aims to Become Global Leader in Artificial Intelligence 

According to Ali Al-Eyd, head of the IMF mission, tourism, construction, public expenditures and sustained growth in financial services are driving non-oil activity. In addition, business-friendly reforms, lower corporate taxes, simplified visa rules, and the success of long-term residency visas are encouraging strong capital inflows and fuelling the demand for real estate in the country. In particular, Dubai’s real estate sector is set to expand in 2025, driven by robust sales performance in 2024, increasing property values, and rapid absorption of new inventory. Notably, there is strong demand for luxury properties in Dubai, with the first half of 2024 recording 43,000 property transactions worth an estimated AED 123 billion, marking an overall increase of 30% compared to 2023.

Read: Dubai Real Estate Market: Trends and Predictions for 2024-2025

Similarly, the IMF study predicted that oil GDP will grow by over 2% this year reflecting OPEC+’s decisions to maintain production cuts and the UAE’s gradual implementation of its OPEC+ quota increase. In terms of inflation, it is expected to hover around 2% in 2025. The review also revealed that UAE banks are well-capitalized and have strong liquidity and their exposure to the property market has decreased in recent years.


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Author: Waqas Siddiqui
I am passionate about supporting businesses in successfully expanding in the UAE and Gulf region. I can be reached at waqas@researchkonnection.com for research inquiries.