According to the forecast of the consulting team of the Ministry of Finance, the economy of the UAE will maintain a decent growth rate of around 4% by 2025, thanks to the oil sector, supported by tourism, construction, and state expenditures, as well as sustainable development of financial services.
During its visit to the UAE, the team emphasized that the increasing capital inflows, originating from social and economic reforms, contribute to the growth of demand for real estate and its price increase in various regions. It is predicted that the oil sector will also continue to grow by more than 2% in the current year due to the subsequent increase in the quota of OPEC.
According to the budget forecast, the financial deficit should account for around 4% of GDP in 2025, with the state debt remaining at around 30% of GDP. It is expected that the trade balance will have a deficit of around 7.5% of GDP, while the international reserves will be sufficient to cover more than 8.5 months of imports.
According to estimates from the Ministry of Finance, banks in the UAE have maintained sufficient capital and liquidity, while the quality of assets improved by 2024. Strong economic activity and constant demand for credit contribute to the increased profitability of banks, despite higher interest rates.
Experts also noted a reduction in the share of risks associated with the real estate sector in the banking sphere from 4 percentage points to 19.6% by September 2024 compared to December 2021.
Moreover, the fund's team emphasized that ongoing economic reforms contribute to a smooth transition in the energy sector and support sustainable growth, with investments in infrastructure facilitating the development of the tourism sector and local economy. Agreements on broader economic partnerships also contribute to supporting trade and attracting foreign investment.
