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The World Bank has revised upwards its forecast for economic growth in the UAE for the next two years, saying in its Global Economic Prospects report (pdf) that it now sees the economy growing at a 3.7% clip in 2024 and 3.8% in 2025. That’s up from the 3.4% growth rate the World Bank had penciled in for the UAE in its June edition of the report.
The World Bank is more conservative than others: The Arab Monetary Fund said in its Arab Economic Outlook in November that it expects the UAE’s GDP to grow 4.3% in 2024, setting it up to post the highest growth rate among GCC countries this year. The Central Bank of the UAE (CBUAE) was also more bullish, saying last month it sees the economy growing at a 5.7% clip this calendar year.
REMEMBER- The UAE’s economy posted 6.6% growth in 2022, with growth easing in 2023. The CBUAE expects last year’s growth to come in at around 3.1%, while the World Bank also revised the country’s projected growth for 2023 up 0.6 percentage points to 3.4%.
The GCC will be performing more or less at the same level: The report sees GCC countries collectively posting 3.6% growth in 2024, the World Bank says, marking a 0.4 percentage point upwards revision from its last report. The report expects GCC growth to accelerate to 3.8% in 2025, with growth expected to be underpinned by increased oil production.
Zooming out further: MENA’s GDP growth is expected to accelerate to 3.5% in each of 2024 and 2025, marking an upwards revision of 0.2 percentage points for 2024 and 0.5 percentage points for 2025 from the World Bank’s June report. The caveat, however, is that the World Bank’s forecast rests on the assumption that conflicts in the region do not spill over or escalate further. The forecast sees the region posting 1.9% growth in 2023.
