The UAE continues to reinforce its position as a global economic powerhouse, with its latest growth figures underscoring the nation’s successful diversification strategy. The country recorded a strong 3.8% economic expansion in the first nine month of 2024, primarily driven by a thriving non-oil sector that now contribute nearly 75% of the national GDP.
This momentum reflects the UAE’s strategic economic policies and its unwavering commitment to reducing dependence on hydrocarbons. As the nation sets its sights on a 5-6% GDP increase in 2025, it further cements its reputation as a global hub for innovation and investment.
Economic Growth and Diversification
Between January and September 2024, the UAE’s GDP rose to Dh1.32 trillion ($359 billion), with the non-oil sector expanding by 4.5% annually to Dh987 billion ($269 billion). The oil sector accounting for 25% of GDP, continues to play a role in the economy but reflects the nation’s ongoing efforts to transition towards a more resilient diversified economic model.
According to Abdullah bin Touq Al Marri, UAE Minister of Economy, the nation’s growth trajectory is a testament to its forward-thinking economic policies. Key factors contributing to this success include:
- Regulatory Reforms: Business-friendly regulations and streamlined processes have enhanced market flexibility and competitiveness.
- Sector-Specific Investments: Strategic investments in technology, renewable energy, logistics, and financial services have driven long-term sustainability.
The UAE’s economic resilience is further underscored by its ability to maintain an average GDP growth rate of 4.8% between 2021 and 2024. More notably, non-oil GDP growth during this period outpaced overall expansion, reaching an annual rate of 6.2% a testament to the country’s successful diversification strategy.
A Framework for Sustainable Development
The UAE’s ambitious “We the UAE 2031” vision seeks to elevate national GDP to Dh3 trillion ($817 billion) by 2031. This strategic roadmap prioritizes emerging sectors, including:
- Artificial Intelligence and Smart Technologies: Driving digital transformation and innovation.
- Circular Economy Initiatives: Enhancing sustainability and resource efficiency.
- Space Technology: Positioning the UAE as a leader in space exploration and research.
The country’s commitment to fostering new economic models is evident in its increasing foreign direct investment inflows, which surpassed $23 billion in 2024. These investments reinforce the UAE’s appeal as a premier global investment destination.
Regional Leadership and Global Recognition
The UAE continues to outpace its regional counterparts, with KPMG forecasting its GDP growth to rise from 3.8% in 2024 to 6.7% in 2025. The nation’s ability to ramp up oil production ahead of OPEC+ peers, coupled with its flourishing private sector, is expected to sustain this upward trajectory.
This economic prowess is reflected in the UAE’s improved global rankings:
- Soft Power Index 2024: Ranked 10th globally, highlighting cultural, diplomatic, and business influence.
- World Competitiveness Report 2024: Climbed three spots to seventh place, surpassing Canada, Japan, and Finland.
- Numbeo’s Safety Index 2024: Abu Dhabi and Dubai secured first and fourth positions, reinforcing the country’s reputation for security and stability.
Attracting High-Net-Worth Individuals and Investment
The UAE has emerged as the world’s leading destination for millionaire migration, with Henley & Partners estimating that 6,700 high-net-worth individuals will relocate to the country by the end of 2024.
The influx of affluent investors is attributed to:
- Favorable Tax Policies: A zero-income tax regime enhances wealth preservation.
- Luxury Infrastructure and Lifestyle: World-class real estate, high-end amenities, and superior connectivity attract global elites.
- Stable Governance: Strong regulatory frameworks and business-friendly policies foster investor confidence.
Sustainability and Green Investments
In line with its COP28 commitments, the UAE is scaling up green investments and sustainable development initiatives. Notable projects include:
Adnoc’s $23 Billion Decarbonization Plan: Aims to reduce carbon emissions and enhance energy efficiency.
Dubai Economic Agenda (D33): Focuses on renewable energy, smart infrastructure, and technological innovation.
By integrating sustainability into its economic agenda, the UAE is positioning itself as a global leader in green finance and environmental stewardship.
The Road Ahead
The UAE’s economic expansion is a testament to its strategic vision and dedication to innovation. Strengthened by a growing non-oil sector and increasing investor confidence, the nation is advancing steadily toward its 2031 economic objectives.
One Investments remains at the forefront of this transformation, offering secure and high-potential investment opportunities. Dubai’s sustained economic growth presents a compelling opportunity to invest in its dynamic real estate market and secure long-term value.
