The economic outlook of the United Arab Emirates (UAE) has begun 2024 with remarkable strength. Preliminary estimates of Gross Domestic Product (GDP) growth for the first quarter, issued by the Federal Competitiveness and Statistics Centre (FCSC), reflect significant resilience and the country’s ability to sustain growth. These positive indicators underscore the efficiency of the implemented economic model, based on diversification, innovation and a strategy of openness to the world.
This growth is not limited to the energy sector, traditionally strong in the region, but extends to key non-oil sectors. This diversification is fundamental to the UAE’s long-term vision, embodied in the “We the UAE 2031” strategy, which seeks to triple the country’s GDP in the next decade. The success of this strategy will depend largely on the UAE’s ability to consolidate itself as a global hub for business, tourism and innovation, leveraging its strategic location and favourable investment environment.
Key Sectors Drive Economic Growth of United Arab Emirates
The sectoral analysis of GDP growth in the UAE during the first quarter of 2024 reveals a number of sectors with outstanding performance. Financial and insurance activities are positioned as the main engine of non-oil growth, with an impressive increase of 7.9% thanks to the increase in local credit granted to the private sector. This financial boost has been fundamental for the recovery of economic activity in general.
Secondly, the transport and storage sector experienced growth of 7.3%. This boom is largely attributed to the notable increase in the number of passengers at the country’s airports, reaching 36.5 million, 14.7% more than in the same period of the previous year. Likewise, the UAE’s ports, especially those of Dubai and Abu Dhabi, have experienced a significant increase in the volume of goods handled, consolidating themselves as key points on global trade routes.
The construction sector has also performed remarkably, with growth of 6.2%. This boom is directly related to the increase in infrastructure investment, driven by the UAE government through various development projects. This sector is key to the country’s vision for the future and is expected to continue growing in the coming years, attracting foreign investment and generating employment.
Tourism and Foreign Trade: Pillars of Sustainable Growth
Tourism, one of the sectors with the greatest growth potential in the UAE, has shown a solid recovery in the first quarter of 2024. Dubai, in particular, received 5.18 million international tourists, representing an 11% increase over the same period last year. The UAE’s reputation as a luxury tourist destination, with a varied offer that combines culture, entertainment and shopping, has been key to attracting visitors from all over the world.
Foreign trade continues to be a fundamental pillar for the UAE economy. Commercial activities represented 16.1% of non-oil GDP, consolidating as the main contributor. The country’s strategic location, coupled with free trade policies and investment in logistics infrastructure, have allowed the UAE to position itself as a leading commercial hub in the region.
The economic growth experienced by the UAE in the first quarter of 2024 is a reflection of the strength of its economy and its ability to adapt to a complex global environment. The commitment to diversification, innovation and openness to the world is paying off, consolidating the UAE as one of the most dynamic and promising economies in the Middle East.
