World Bank forecasts accelerated growth for UAE in 2024
The United Arab Emirates (UAE) is poised for accelerated economic growth in 2024, with the real gross domestic product (GDP) projected to surge by 3.9 percent, according to the Spring 2024 Gulf Economic Update (GEU) released by the World Bank. The report attributes this growth to several factors, including OPEC+‘s announced significant oil production hike in the latter half of the year and a resurgence in global economic activity.
Oil output is anticipated to spike by 5.8 percent in 2024, while non-oil sectors are expected to maintain their robust performance, driving economic expansion by 3.2 percent. Key drivers of non-oil growth include the thriving tourism, real estate, construction, transportation, and manufacturing industries. Strategic spending initiatives and a commitment to sustainable development have bolstered the UAE’s economic resilience. The country boasts a strong current account surplus, standing at 9.1 percent of GDP, buoyed by escalating non-oil exports in tourism and commercial services.
The report underscores the UAE’s prudent financial management, with significant growth recorded in financial reserves throughout 2023. This growth trend, observed across most Gulf Cooperation Council (GCC) nations, has been propelled by both the oil and gas sector and the expansion of non-oil exports. In line with its diversification agenda, the UAE has greenlit substantial investments in critical sectors. Notable among these is a US$10 billion allocation for tourism infrastructure development and the initiation of a sizable public-private partnership portfolio valued at US$10.9 billion.
Structural reforms and strategic investments remain focal points in the UAE’s economic roadmap. Key initiatives include Abu Dhabi’s US$10 billion investment in tourism infrastructure, ADNOC Gas‘s US$13 billion gas expansion plan over the next five years, and Dubai’s approval of a large public-private partnership portfolio. Furthermore, the UAE has witnessed a resurgence in employment, with levels returning to pre-pandemic norms.
The government’s Emiratisation strategy is receiving a boost, with a budget of US$1.74 billion aimed at integrating 36,000 citizens into the private sector by 2024. In summary, the UAE’s economic outlook for 2024 appears robust, buoyed by diverse growth drivers and strategic initiatives aimed at ensuring sustainable development and economic resilience.