UAE's Non-Oil Sectors Propel Economic Growth

UAE Economy 2024: Non-Oil Sector Drives Growth

The United Arab Emirates economy achieved a remarkable 4% growth in 2024, reaching 1.776 trillion dirhams, with non-oil sectors playing a crucial role in this performance. Non-oil-related activities accounted for 75.5% of the Gross Domestic Product, or 1.342 trillion dirhams, while the oil segment contributed 434 billion dirhams.

Strategic Transformation and Diversification

The achieved results reinforce confidence in the country's long-term economic future, supported by the 'We the UAE 2031' vision and the related reforms and investments. Policy makers aim to build a knowledge-based, innovation-driven economy capable of withstanding global challenges.

Foreign trade also grew significantly: in the first quarter of the year, non-oil foreign trade expanded by 18.6% year-on-year, reaching 835 billion dirhams, while non-oil exports showed a 41% jump. The goal is for the value of non-oil foreign trade to reach 4 trillion dirhams by 2031, which could be achieved within two years.

Sectoral Growth

Several sectors showed dynamic growth in 2024:

Transport and Logistics: 9.6% growth, driven mainly by recovery in air transport and freight. Emirates airports handled a total of 147.8 million passengers, a 10% increase compared to the previous year.

Construction and Real Estate: Thanks to infrastructure developments, construction grew by 8.4%, while the real estate sector expanded by 4.8%. Demand for residential and commercial properties remains high.

Financial and Insurance Services: The sector grew by 7%, due to strong capital inflows and a stable banking sector.

Hospitality and Tourism: Showed a 5.7% growth, supported by increased tourist traffic and high hotel occupancy rates.

Main Pillars of Non-Oil GDP

The largest share was represented by wholesale and retail trade (16.8%), followed by manufacturing (13.5%), financial and insurance activities (13.2%), construction (11.7%), and the real estate sector (7.8%). These figures indicate that growth does not rely on a single sector, but is multifaceted and balanced.

Future Prospects

According to the International Monetary Fund (IMF), UAE is expected to show strong growth in the coming years, partly due to targeted economic policy measures, steps towards green energy and digital transformation, and labor market reforms.

The UAE Central Bank expects 5.4% growth in the non-oil sector by 2025, supported by domestic demand, active foreign trade, and increasing foreign direct investments. Additionally, international events such as COP28 have further enhanced the country's reputation and investment appeal.

Summary

In 2024, the United Arab Emirates economy set an example in diversification and sustainable growth. The strengthening of non-oil sectors, infrastructure developments, growth in foreign trade, and thoughtful economic policy measures all contribute to the country's ambition to remain a dynamic, competitive, and forward-looking economic player in the region over the next decade.

(The article's source is a statement by the Federal Competitiveness and Statistics Centre (FCSC).)