The UAE’s economy grew by 3 per cent on an annual basis in the first three months of 2026 to reach Dh485 billion ($132 billion), as the country’s non-oil sector expanded.
The UAE’s non-oil gross domestic product grew by 4.8 per cent, raising its contribution to 79.4 per cent of the national economy, reflecting the continued strength of non-oil economic activities, the UAE government media office said on Tuesday, quoting data from the Federal Competitiveness and Statistics Centre.
The quarter included one month of the Iran war, at a time when the UAE was facing daily Iranian missile and drone attacks, causing disruption to the local economy.
“The growth led by the non-oil economy … is not an isolated figure, but the outcome of integrated government policies and initiatives working as one system towards one goal: consolidating the UAE’s standing as a global leader in competitiveness, excellence and future readiness,” said Mohammed Al Gergawi, Minister of Cabinet Affairs.
The results demonstrate the resilience of the national economy, as the growth was achieved despite the regional challenges encountered during the first quarter of the year, the media office said. The effects of the regional crisis was confined to a limited number of activities and did not affect the overall trajectory of economic growth, it added.
Key growth sectors
Financial and insurance activities led the growth in the first quarter at 17.3 per cent, followed by construction at 8.1 per cent and human health and social work activities at 7.7 per cent, government data shows.
Information and communication activities grew by 5.9 per cent, while professional, scientific and technical activities, together with administrative and support service activities, grew by 4.9 per cent to reflect “continued momentum across vital, high-value-added economic activities”.
Omniyat chief ‘doubling down’ on the UAE
The UAE’s two financial centres achieved strong growth in the first half of this year. Abu Dhabi’s ADGM posted a 57 per cent increase in assets under management in the three-month period amid the continued flow of capital, it said in May.
The number of companies at Dubai International Financial Centre rose at a record pace in the first half of the year as it continued to attract banks, wealth and asset managers, and hedge funds from around the globe, despite uncertainty caused by the war.
The data also showed real estate activities growing by 4.8 per cent during the quarter. Public administration, defence and compulsory social security increased by 4.5 per cent, while wholesale and retail trade by 2.6 per cent, it showed.
Defying war challenges
The UAE, the Arab world’s second-largest economy, continues to grow despite the conflict. The country is pushing for diversification, as well as signing Comprehensive Economic Partnership Agreements.
The strong performance of the country’s foreign trade, backed by its Cepas, has opened new markets for non-oil exports, the media office said. The UAE has strengthened the performance of manufacturing, trade and logistics activities, it added.
Non-oil exports grew by 23.9 per cent during the first half of 2026 to reach Dh452.8 billion – the highest growth rate among the components of the UAE’s foreign trade, government data shows.
That confirms the “pivotal role of trade openness in stimulating domestic production and enhancing the competitiveness of the industrial and services sectors as among the country’s most important drivers of economic diversification”, said Dr Thani Al Zeyoudi, Minister of Foreign Trade. He added that the first-quarter result boosted the UAE’s appeal to high-quality investors.
The Iran war has tipped the region into one of its worst geopolitical crises in decades. The conflict, which began on February 28 when Israel and the US launched strikes on Iran, led Tehran to attack its Arab neighbours and close the Strait of Hormuz.
UAE has huge stockpile of essential goods, says Minister of Economy and Tourism
But despite more than four months of disruption, Gulf states have maintained growth momentum, albeit at a slower rate, the International Monetary Fund said in June. The UAE economy is set to rebound in the second half of the year, amid a recovery in exports after the country’s exit from Opec, the IMF said last month.
In May, ratings agency Fitch retained its long-term issuer default rating of AA- for the UAE, stating that oil export revenue, owing to higher crude prices, is expected to remain strong despite the conflict and is to offset any immediate negative impact.
The Emirates also has abundant fiscal and external buffers. It has been anchored by Abu Dhabi’s sovereign net foreign assets, estimated at about 164 per cent of UAE gross domestic product in 2025 – among the highest of Fitch-rated sovereigns, the rating agency said at the time.
Abdulla bin Touq, Minister of Economy and Tourism, said the first-quarter growth reflected the robustness of national economic performance and its ability to sustain growth. “This performance also reflects the country’s vision of transitioning towards a more diversified and sustainable economic model, capable of adapting to global developments and sustaining its growth trajectory, in line with the objectives of the ‘We the UAE 2031’ vision, which seeks to double the size of the national economy to Dh3 trillion by 2031,” he said.
Key statisticsGDP reached Dh485 billion, growing 3 per cent compared with the first quarter of 2025.Non-oil GDP grew by 4.8 per cent, raising its contribution to 79.4 per cent of the national economy.Financial and insurance activities were the fastest growing at 17.3 per cent, followed by construction at 8.1 per cent.The financial sector contributed 2.44 percentage points of total non-oil growth.Non-oil exports recorded Dh452.8 billion, growing 23.9 per cent during the first half of 2026.
