UAE economy to grow 4.2% in 2024, says central bank

Reuters

The UAE’s gross domestic product (GDP) is expected to expand by 4.2 percent in 2024, further growing to 5.2 percent in 2025, the Central Bank of the United Arab Emirates (CBUAE) said in its quarterly economic review.

The bank maintained its estimate for 3.1 percent growth in 2023.

Non-oil GDP growth is forecast to reach 4.7 percent in 2024 and 2025, while oil GDP growth is expected at 2.9 percent in 2024 and 6.2 percent in 2025.

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The Emirate’s consolidated fiscal balance for the first nine months of 2023 posted a surplus of AED61 billion, or 4.4 percent of GDP. Total revenues amounted to AED370 billion, while expenditures reached AED309 billion.

The central bank sees the federal corporate tax to further strengthen government finances, aiding in revenue diversification.

In addition, the continued strength of the non-oil private sector indicated robust economic activity, as the UAE’s purchasing managers’ index (PMI) reached 56.6 in January 2024, driven by ongoing business confidence in the economy.

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Sustained demand and sales, continuous expansion in the production sector and growth in new projects and investment activities support this optimism.

Dubai’s PMI reached 56.6 in January, indicating sustainable growth in the emirate’s non-oil private sector, the central bank said.

Economic growth boosted employment numbers as private sector employment rose by 3.1 percent in the fourth quarter of 2023 and average wages jumped by 7.4 percent year on year.

Last month Ministry of Finance data showed that UAE government revenues reached AED156 billion ($42 billion) for the fourth quarter in 2023, resulting in the Gulf state recording a federal surplus of AED25 billion ($6.8 billion) over the period.