UAE Economic Growth Outlook 2025–2026: Central Bank Forecasts Robust Expansion Ahead
August 5, 2025 | Central Bank of the UAE (CBUAE) Update
The Central Bank of the UAE (CBUAE) has released its 2024 Financial Stability Report, projecting a robust economic future for the nation. Following an estimated 4% GDP growth in 2024, the UAE’s economy is expected to grow by 4.4% in 2025 and accelerate further to 5.4% in 2026.
This upward trajectory is fueled by ongoing economic diversification, strong momentum in the non-oil sector, and the continued resilience of the country’s financial and banking systems.
🔹 Highlights from the Report
- Banking Sector Strength: UAE banks remain well-capitalised and liquid, with improved asset quality. Stress tests confirmed the sector’s ability to absorb shocks while maintaining lending capacity.
- Financial Stability: Risk levels remained stable in 2024, supported by sound macroeconomic fundamentals and strong regulatory frameworks.
- Operational Milestones: The activation of the UAE Financial Stability Council, chaired by Sheikh Mansour bin Zayed Al Nahyan, has significantly enhanced coordination across financial institutions and boosted systemic risk oversight.
📈 Non-Bank Financial Sector Performance
- The insurance sector saw a 21.4% surge in gross written premiums, reaching AED 64.8 billion.
- Solvency across non-bank financial institutions (NBFIs) remains strong, reflecting growing investor and consumer confidence.
💡 Fintech & Digital Innovation
The year 2024 witnessed rapid digital transformation across financial services:
- Launch of the “Jaywan” domestic card scheme
- Expansion of the “Aani” Instant Payment Platform
- Progress in the Digital Dirham initiative
- Adoption of AI, big data analytics, and digital payments across institutions
CBUAE also introduced new macroprudential tools, tighter cybersecurity regulations, and a renewed focus on climate risk assessments, aligning the UAE with global best practices in sustainable finance.
🔮 Looking Ahead
CBUAE Governor Khaled Mohamed Balama reinforced the Central Bank’s forward-looking approach:
“The UAE maintained strong economic and financial conditions in 2024, despite rising global risks. At CBUAE, we continue to develop a resilient regulatory framework that supports sustainable growth and enhances financial stability.”
With strategic foresight, regulatory strength, and digital innovation, the UAE is well-positioned for sustainable and inclusive economic expansion in the years ahead.
