5% expected growth of the UAE economy in 2026

The World Bank expects the UAE economy to grow by 5% during the current year 2026, with the rate rising to 5.1% in 2027, according to the “Global Economic Prospects” report issued yesterday.

According to the report, growth in the Gulf Cooperation Council countries is expected to rise to 4.4% in 2026, and 4.6% in 2027.

The report expects the growth rate in the Middle East, North Africa, Afghanistan and Pakistan to rise to 3.6% in 2026, and to continue improving to reach 3.9% in 2027.

The World Bank reported in the latest edition of its “Global Economic Prospects” report that the global economy has proven more resilient than expected, despite continuing trade tensions and policy uncertainty.

The report indicated that global growth will remain relatively stable over the next two years, declining to 2.6% in 2026, before rising to 2.7% in 2027, which is an upward revision compared to June expectations.

Resilience reflects better-than-expected growth, especially in the United States, which represents about two-thirds of the upward revision in 2026 forecasts.

According to the report, if these expectations are fulfilled, the 2020s are on track to become the weakest decade for global growth since the 1960s.

The report confirms that the slow pace of growth leads to a widening gap in living standards globally. At the end of 2025, per capita income in most advanced economies exceeded 2019 levels, while about a quarter of developing economies remained at lower levels.

In 2025, global growth benefited from a boom in trade that preceded policy changes, along with rapid readjustment in global supply chains, and the impact of this boost is expected to fade in 2026 due to declining trade and domestic demand.

According to the report, global inflation is expected to decline to 2.6% in 2026, reflecting weak labor markets and declining energy prices, and growth is expected to improve in 2027 as trade flows adjust and policy uncertainty recedes.

“With each passing year, the global economy becomes less able to achieve growth and more resilient to policy uncertainty,” said World Bank Group Chief Economist and Senior Vice President for Development Economics, Indermeet Gill.

The report expected the growth of developing economies to slow in 2026 to 4% compared to 4.2% in 2025, before rising slightly to 4.1% in 2027 as trade tensions subside, commodity prices stabilize, financial conditions improve, as well as enhanced investment flows.