UAE Economy Grows 3.9% in Early 2025, Led by Non-Oil Sectors
The economy of the United Arab Emirates (UAE) grew by 3.9% in the first quarter of 2025 compared to the same period last year, according to the state news agency WAM. The country’s real gross domestic product (GDP) reached $123.8 billion (AED 455 billion) during this period. This growth was mainly driven by a strong rise in non-oil activities, which increased by 5.3%.
Strong First-Quarter Performance
Non-oil GDP, which includes industries such as manufacturing, trade, and finance, reached $95.8 billion (AED 352 billion) in the first quarter. Oil-related activities, however, contributed 22.7% of the total economy.
Among all sectors, manufacturing showed the highest growth, rising by 7.7%. The finance, insurance, and construction sectors each grew by 7%, while real estate expanded by 6.6% and trade by 3%.
When looking at the share of each sector within non-oil GDP, trade was the largest contributor at 15.6%. Finance and insurance came next with 14.6%, while manufacturing industries made up 13.4%.
Minister Highlights Economic Strength
Abdullah bin Touq Al Marri, Minister of Economy and Tourism, said the results prove the strength and resilience of the UAE’s economy. He explained that the strong performance reflects both investor trust and the confidence of the international community in the UAE’s business environment.
The minister also pointed out that non-oil activities now account for 77.3% of the real GDP, a record high. This aligns with the “We the Emirates 2031” vision, which aims to grow the country’s economy to $816.7 billion (AED 3 trillion) by the next decade.
Business Activity in August
The UAE’s non-oil business activity also showed growth in August 2025. The seasonally adjusted S&P Global UAE Purchasing Managers’ Index (PMI) rose to 53.3, up from 52.9 in July, which had been the lowest level in 49 months.
A PMI score above 50 indicates business growth. The increase in August was driven by stronger output levels midway through the third quarter. The report noted that this was the fastest pace of activity growth in six months, slightly better than the long-term average.
Key Drivers Behind the Growth
Businesses surveyed pointed out several reasons for the improvement. These included:
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Higher sales volumes, showing stronger demand in the market.
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Ongoing projects, which boosted production and services.
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Stronger local market conditions, helping companies maintain steady growth.
Outlook for the UAE Economy
Overall, the UAE continues to show strong economic performance in 2025, thanks to its diversification away from oil. Sectors such as manufacturing, finance, real estate, and trade are becoming increasingly important in driving the country’s growth.
With a growing share of non-oil GDP, the UAE is well on track to meet its 2031 economic vision. If this momentum continues, the country is likely to maintain its position as one of the most dynamic and attractive economies in the region.
Published: 8th September 2025
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