UAE defies oil slump with strong growth

The UAE is emerging as a standout performer in the Gulf, transforming lower oil prices into a catalyst for innovation, trade expansion, and sustainable growth.

- Issac John [e-mail]

Towers along Sheikh Zayed Road in Dubai. Non-oil trade surpassed Dh2.8 trillion ($762 billion) in 2024 -- a 13.6 per cent year-on-year rise.

As Opec+ increases production and crude prices hover near $60 per barrel —the lowest since 2020 — the UAE’s diversified economy is proving remarkably resilient, outpacing regional peers and reinforcing its position as a global business hub.

Analysts argue that although evolving Opec+ production and soft crude prices pose clear challenges across the region, the UAE is emerging as an outlier. As the International Monetary Fund (IMF) noted after an October 2025 visit, the country “has shown strong resilience to global uncertainty, regional tensions, and oil price fluctuations.” The IMF now projects the UAE’s GDP to grow by about 4.8 per cent in 2025 and 5.0 per cent in 2026 — significantly ahead of many of its peers.

Behind the UAE's strong performance lies the government’s decade-long diversification agenda. Non-oil sectors now contribute more than 73 per cent of GDP, according to the Central Bank of the UAE, driven by tourism, logistics, manufacturing, and the digital economy. Non-oil trade surpassed Dh2.8 trillion ($762 billion) in 2024 — a 13.6 per cent year-on-year rise — while inflation remained low at 1.4 percent in early 2025, helping sustain consumer spending and investor confidence.