The United Arab Emirates’ economy grew by 3.8% in the second quarter of 2025, driven primarily by robust performance in non-oil sectors such as manufacturing and services. This growth highlights the country’s ongoing economic diversification and resilience amid global uncertainties. According to economic analysts, the UAE’s manufacturing sector has shown significant expansion, supported by increased industrial output, investments in technology, and rising export demand. Key industries including machinery, chemicals, and construction materials contributed to the overall GDP growth. The services sector also played a crucial role in the economic performance. Financial services, tourism, logistics, and trade experienced notable growth, reflecting both domestic demand and international interest in the UAE’s markets. Analysts note that a strong service industry helps reduce dependence on hydrocarbon revenues and enhances long-term economic stability. Economic experts highlight that government policies aimed at supporting innovation, investment, and business-friendly regulations have reinforced growth in non-oil sectors. Initiatives such as funding programs, regulatory reforms, and infrastructure development have created a conducive environment for businesses to expand and contribute to GDP. The oil and gas sector, while still significant, contributed modestly to growth in Q2. Rising oil production and stable global prices provided additional support, but diversification efforts ensured that the non-oil sectors remained the primary drivers of the UAE’s economic expansion. IMF and regional economic analysts noted that the UAE’s GDP growth is above the global average for the quarter. This performance positions the UAE as a resilient economy in the Middle East, capable of sustaining steady growth despite international economic challenges. Tourism and hospitality sectors benefited from ongoing global travel recovery. International events, cultural festivals, and business conferences have attracted visitors, boosting spending and supporting related industries. Experts believe that continued focus on tourism infrastructure and marketing will maintain momentum for these sectors. The UAE’s logistics and transportation sectors also contributed to the GDP growth. Improvements in ports, airports, and supply chain infrastructure have enhanced trade efficiency, supporting both import-export activities and regional commerce. Analysts say this strengthens the UAE’s position as a global business hub. Financial and real estate sectors remain important contributors as well. Rising real estate demand, commercial development, and strong banking activity have reinforced domestic economic activity. Observers note that sound fiscal policies and strategic urban development are key factors in sustaining growth in these sectors. Looking ahead, economists expect the UAE’s GDP to continue its upward trend in the coming quarters. Continued investment in digital transformation, renewable energy, and innovative industries is likely to further support non-oil sector expansion, ensuring long-term economic resilience. Government officials emphasized the importance of sustaining diversification efforts while maintaining macroeconomic stability. Strategic plans focusing on infrastructure, human capital, and technology adoption are expected to enhance productivity and competitiveness in the global market. The UAE’s Q2 growth underscores the effectiveness of its economic diversification strategy. By balancing traditional energy production with modern sectors like manufacturing, services, and tourism, the country demonstrates its ability to maintain sustainable growth and withstand external shocks. Experts also highlight that continued investment in education, innovation, and technology-driven industries will reinforce the UAE’s long-term growth prospects. These efforts align with national development plans and the vision of creating a knowledge-based economy. Overall, the UAE’s 3.8% GDP growth in Q2 2025 reflects a resilient, diversified, and forward-looking economy. Strong non-oil sector performance, coupled with strategic policy support, positions the country for continued growth and global economic competitiveness.