Today's Edition
A. SREENIVASA REDDY (ABU DHABI)
The International Monetary Fund (IMF) has upgraded its growth forecast for the UAE economy to 4.8% in 2025, up from 4.0% projected in April, while maintaining its 2026 outlook at 5.0%. The revision reflects the UAE’s continued economic momentum, following an estimated 4.0% expansion in 2024.
The IMF’s latest World Economic Outlook (WEO), released on Tuesday, also projects that global growth will reach 3.2% in 2025, higher than its July forecast of 3.0% and April estimate of 2.8%. Global output is forecast to slow marginally to 3.1% in 2026, unchanged from the July update.
Among oil exporters, growth is projected at 3.2% in 2025 and 3.5% in 2026, compared with 2.7% in 2024. Saudi Arabia’s outlook remains strong, with GDP expected to grow 4.0% in both 2025 and 2026 — an upward revision of 0.4 and 0.1 percentage points from July, and 1.0 and 0.3 points from April, respectively.
The IMF said the latest projections mark an upward revision from April but remain below pre-policy-shift expectations amid global uncertainty. It expects advanced economies to expand around 1.5% and emerging market and developing economies just above 4%.
The report noted that inflation continues to decline worldwide but varies across regions — remaining above target in the United States and subdued elsewhere. It warned that “uncertainty about the stability and trajectory of the global economy remains acute,” as trade tensions, fiscal imbalances, and immigration restrictions weigh on prospects.
“Global growth is projected to slow from 3.3 per cent in 2024 to 3.2 per cent in 2025 and to 3.1 per cent in 2026,” the IMF said, adding that the slowdown reflects headwinds from uncertainty and protectionism despite easing tariff shocks.
The IMF urged policymakers to “restore confidence through credible, predictable, and sustainable policy actions.” It called for clear, transparent, and rules-based trade roadmaps to reduce uncertainty and rebuild fiscal buffers. The Fund emphasised preserving central bank independence and accelerating structural reforms — including measures to promote labour mobility, digitalisation, and institutional strengthening — to lift long-term growth prospects.
The World Economic Outlook, published twice a year, provides the IMF’s comprehensive assessment of the global economy, covering advanced, emerging, and developing markets. The October 2025 edition, titled “Global Economy in Flux: Prospects Remain Dim,” highlights the need for sustained reform momentum and trade diplomacy to navigate a period of shifting global economic dynamics.
