Globally, growth is expected to remain stable but lackluster, with projections of 3.2 percent for both 2024 and 2025 

The UAE’s real GDP is anticipated to hold steady at 4 percent in 2024, with an increase to 5.1 percent projected for 2025, as reported by the IMF World Economic Outlook (WEO).

This forecast was launched during the 2024 IMF/World Bank Group Annual Meetings, which also predicted that the economies of the Middle East and Central Asia will grow by 2.4 percent and 3.9 percent in 2024 and 2025, respectively.

Global growth trends

Globally, growth is expected to remain stable but lackluster, with projections of 3.2 percent for both 2024 and 2025, consistent with figures from the July and April 2024 WEO reports.

Inflation forecast

Global headline inflation is predicted to decline from an annual average of 6.7 percent in 2023 to 5.8 percent in 2024 and 4.3 percent in 2025, with advanced economies expected to reach their inflation targets sooner than their emerging counterparts.

Economic growth in major economies

The WEO indicated that the US economy is forecasted to grow by 2.8 percent in 2024, decreasing to 2.2 percent in 2025, while the Eurozone is anticipated to grow by approximately 0.8 percent this year and 1.2 percent next year.

World Bank’s MENA economic update

Earlier this month, the World Bank released its semi-annual MENA Economic Update, projecting the UAE’s GDP growth at 3.3 percent in 2024, increasing to 4.1 percent in 2025.

According to the report, the UAE’s current account surplus is expected to decrease to 7.5 percent in 2024, down from 9.2 percent of GDP in 2023, despite ongoing diversification efforts.

In 2025, the MENA region is expected to grow by 3.8 percent, with GCC countries projected to strengthen to 4.2 percent growth in 2025, up from 1.9 percent in 2024.

The report predicts a modest increase in the region’s overall GDP growth to 2.2 percent in real terms for 2024, up from 1.8 percent in 2023.

Arab Monetary Fund projections

Additionally, in July 2024, the Arab Monetary Fund (AMF) projected the UAE’s economy to grow by 3.9 percent in 2024, rising to 6.2 percent in 2025.

The report emphasized that the UAE’s economy is underpinned by strong fundamentals, supported by a dynamic non-oil sector and effective public and monetary policies aimed at fostering economic growth, financial stability, and the soundness of the financial system.

The report detailed that the UAE experienced substantial economic growth of 7.5 percent in 2022, bolstered by a successful response to the COVID-19 pandemic, supportive financial measures, and the cultivation of a business-friendly environment established in previous years.

SOURCE & CREDITS: economymiddleeast.com