World Bank sees UAE growth reaching 4.9% in 2027

The UAE’s economy is set to maintain strong momentum over the next few years, with the World Bank projecting growth of 4.6% in 2025 and 4.9% in both 2026 and 2027, WAM reported.

The upward trend is driven largely by robust performance in non-oil sectors, which continue to be the main engines of growth.

According to the latest Gulf Economic Update (GEU) released by the World Bank -- based on data available as of June 1 -- the broader GCC region is also expected to see steady improvement, with overall economic growth reaching 3.2% in 2025 and rising to 4.5% by 2026.

Non-oil sectors across the GCC demonstrated resilience in 2024, expanding by 3.7%, largely due to rising private consumption, investment, and ongoing structural reforms. Regional GDP grew by 1.7% in 2024, up from 0.3% in 2023.

Among individual Gulf states, Bahrain’s economy is projected to stabilize at 3.5% in 2025. Kuwait is expected to rebound to 2.2%, while Oman is forecast to gradually pick up pace -- from 1.7% in 2024 to 3% in 2025, 3.7% in 2026, and 4% in 2027.

Qatar’s economy is anticipated to remain steady at 2.4% in 2025, before accelerating to an average of 6.5% over 2026–2027. Meanwhile, Saudi Arabia is projected to see continued recovery, with growth reaching 2.8% in 2025 and averaging 4.6% across 2026 and 2027.

Despite the positive outlook, the World Bank cautioned that global uncertainties -- particularly in trade and potential economic slowdowns -- pose risks to the region’s economic trajectory. To mitigate these challenges, the report urges GCC governments to accelerate reforms focused on diversifying their economies and deepening regional trade.

“The resilience of GCC countries in navigating global uncertainties while advancing economic diversification underscores their strong commitment to long-term prosperity,” said Safaa El Tayeb El-Kogali, the World Bank’s Division Director for GCC countries.

She added that sustaining growth would depend on “strategic fiscal policies, targeted investments, and a strong focus on innovation, entrepreneurship, and job creation for youth.”

The report, titled Smart Spending, Stronger Outcomes: Fiscal Policy for a Thriving GCC, also examines the effectiveness of fiscal strategies in supporting economic stability and growth.

It finds that during downturns, increased government spending has helped stabilize regional economies -- with each unit of fiscal expenditure boosting non-oil output by an estimated 0.1 to 0.45 units.

The findings come at a time when several GCC countries are grappling with budgetary pressures from fluctuating oil prices, making fiscal prudence and policy reform even more critical for sustained progress.