The upcoming report titled “Economic Updates for Gulf Countries” – Fall 2025 edition, published by the World Bank, forecasts a 4.8% growth for the United Arab Emirates’ economy.
The report emphasizes that the UAE continues to experience robust and widespread growth across both oil and non-oil sectors, predicting that the real GDP will increase by 4.8% in 2025. The country is also recognized as a leader in diversifying its export base.
Predicted economic growth rates for other Gulf nations include 3.8% for Saudi Arabia, 3.5% for Bahrain, 3.1% for Oman, 2.8% for Qatar, and 2.7% for Kuwait.
The report, titled “Digital Transformation in the Gulf: A Strong Driver for Economic Diversification,” highlights three main themes, including the evolution of economic diversification indicators over the past decade, tracking macroeconomic developments, and focusing on digital transformation.
It examines the results of economic diversification efforts across Gulf Cooperation Council (GCC) countries over the last ten years, indicating moderate progress with some promising signs emerging recently.
The report showcases the rapid digital transformation within the Gulf region and the accelerating adoption of artificial intelligence, with all GCC countries boasting advanced communication networks covering over 90% with 5G connectivity and affordable high-speed internet.
Significant investments in data centers and high-performance computing systems are enhancing readiness for artificial intelligence, with the UAE and Saudi Arabia emerging as leaders on both regional and global fronts.
This progress is supported by various enabling systems, such as project financing and innovation facilitation, alongside government adoption of generative AI applications in their operations.
Safaa Al-Tayeb Al-Kawqali, the World Bank’s regional director for the GCC, noted that diversification and digital transformation have become essential rather than optional for achieving long-term economic stability and prosperity.
She added that the digital leap taken by GCC countries is remarkable, as strong infrastructure and growing computing capabilities in the field of artificial intelligence enhance the region’s position for leadership and innovation, provided that environmental and labor market challenges are proactively addressed.
The report also highlights that the participation of Gulf women in science, technology, engineering, and mathematics (STEM) fields exceeds the global average, further strengthening the region’s digital competitiveness.
It recommends supporting small and medium-sized enterprises in adopting artificial intelligence to enhance the innovation environment, as well as implementing training programs to develop skills and mitigate labor market shortages, in order to maximize the benefits of diversification and digital transformation.