The UAE economy is set to outpace its regional peers in 2025, with the World Bank’s latest Gulf Economic Update forecasting real GDP growth of 4.8 percent as the nation strengthens its position in diversification and digital transformation.
Released today, the Fall 2025 edition of the report highlights the UAE’s balanced expansion across oil and non-oil sectors and notes its continued success in widening its export base. The World Bank also projects growth across the GCC, including 3.8 percent for Saudi Arabia, 3.5 percent for Bahrain, 3.1 percent for Oman, 2.8 percent for Qatar, and 2.7 percent for Kuwait.
The report outlines three key pillars shaping the region’s economic trajectory. These include the evolution of diversification indicators over the past decade, macroeconomic developments, and the Gulf’s rapid digital transformation.
GCC countries have achieved moderate progress on diversification, with stronger signs emerging in recent years. The digital shift is described as significant, supported by widespread 5G coverage, affordable high-speed internet, and major investments in data centres and high-performance computing. The UAE and Saudi Arabia are recognised as leaders in AI readiness both regionally and internationally.
Safaa El Tayeb El Kogali, World Bank Division Director for the GCC, said diversification and digital transformation are now essential for long-term stability. She noted that the region’s strong infrastructure and advancing AI capabilities place Gulf economies in a favourable position for sustainable growth.
The report also highlights that women’s participation in STEM fields across the Gulf surpasses the global average, boosting the region’s digital competitiveness. It recommends greater support for SMEs in adopting AI and further investment in workforce training to bridge labour-market gaps and maximise the benefits of ongoing transformation.
News Source: Emirates News Agency
