UAE Economy Shows Strong Growth: CBUAE 2024 Annual Report Highlights

The Central Bank of the UAE (CBUAE) has released its comprehensive Annual Report for 2024, offering valuable insights into the country’s economic performance and financial landscape. For businesses operating in the UAE or considering expansion into the region, this report provides critical data to inform strategic decisions.

Economic Growth and Stability

According to the report, the UAE economy demonstrated impressive resilience in 2024, with real GDP growing by an estimated 3.9%. This growth was primarily driven by strong performance in the non-hydrocarbon sectors, including industries such as tourism, real estate, technology, and financial services, while the hydrocarbon sector of oil and gas production also exhibited signs of recovery. This distinction is crucial as it showcases the UAE’s successful economic diversification beyond oil dependence, creating a more resilient economy capable of sustaining growth even against oil price fluctuations or as the world transitions to greener energy sources.

Inflation Remains Under Control

In contrast to global trends, inflation in the UAE remained well-controlled at just 1.7% in 2024, significantly below the world average of 5.7%. This stability provides businesses with a predictable cost environment for planning and operations.

The CBUAE projects inflation to reach 2.0% in 2025 and 2.1% in 2026, still maintaining modest levels that support business growth and consumer spending.

Banking Sector Strength

The UAE banking sector demonstrated remarkable strength in 2024:, Total banking sector assets reached AED 4.56 trillion: Credit growth increased by 9.5% year-on-year: Deposit growth was impressive at 12.9% year-on-year: The sector maintained healthy capital and liquidity buffers, Asset quality continued to improve

The CBUAE also strengthened capital buffers in the banking sector as a proactive measure to address cyclical fluctuations, contributing to long-term financial stability.

Real Estate Sector Performance

The UAE’s real estate sector posted strong growth in 2024, benefiting from the country’s position as a key economic and investment center in the Middle East and North Africa (MENA) region, with report of residential sales transactions in Abu Dhabi and Dubai increased by 37.7% year-on-year