UAE economic performance surpasses expectations amid investment in new sectors

The recent economic performance of the UAE has surpassed expectations despite rising global and regional uncertainty.

This is testament to the country’s economic resilience as it continues to push for diversification and investment in new sectors and industries to maintain growth momentum, Abdulla bin Touq, Minister of Economy, said.

The UAE, the Arab world’s second-largest economy, has taken the lead on sustainable finance and climate stewardship globally and will continue to invest in developing key components that will shape the future growth of the country, the minister told delegates at the Abu Dhabi Finance Week on Monday.

“Investments in new economic sectors and emerging industry is paramount to the UAE economic [development], its sustainable economic growth and diversification,” Mr bin Touq said in his keynote address at The Abu Dhabi Global Market.

“We recognise the transformative power of innovation, technology and forward-thinking industries and shaping our nation’s future. The UAE has made significant strides in that direction and our investments in sectors such as renewables, artificial intelligence, biotechnology and manufacturing have been robust.”

The UAE achieved 3.7 per cent gross domestic product expansion in the first six months of this year, the highest rate of GDP growth in GCC, driven by a “remarkable” 5.9 per cent expansion in its non-oil economy, the minister said.

The non-oil sector accounts for about 70 per cent of the UAE economy, a testament to the success of the country diversification efforts.

The robust growth of the UAE’s tourism sector, coupled with a focus on developing the country’s industrial base through initiatives such as the Operation 300 Billion and the Abu Dhabi Industrial Strategy have helped in maintaining strong non-oil economic growth momentum.

That momentum will continue during the remainder of the year, driven by the UN climate summit Cop28 taking pace in Dubai, he said.

The country has taken the lead in sustainable finance and responsible investments as the UAE recognises its importance as it is “no longer a nice concept, it is the new kid on the block”, Mr bin Touq said.

“Our government truly believes in it, and we are committed to creating a conducive environment for responsible investment in the UAE and we have the ambition of becoming a global hub for green finance,” the minister said.

“We understand that sustainable finance and responsible investments are essential components of the global financial landscape.”