The UAE’s economy has demonstrated robust growth in the first quarter of 2026, reflecting a strong performance in non-oil sectors. The country’s real GDP expanded by 3% compared to the same period last year, reaching approximately $132.1 billion (AED 485 billion). This growth is primarily driven by an impressive 4.8% increase in non-oil GDP, which now constitutes 79.4% of the national output.

Significant Non-Oil Economic Expansion

In the first quarter of 2025, the real GDP base was reported to be about $128.2 billion (AED 470.9 billion). In comparison, non-oil activity added around $4.8 billion (AED 17.6 billion) to the economy, illustrating its significant contribution. Non-oil activities were responsible for roughly 3.75 percentage points of the overall 3% GDP growth, whereas oil-related sectors contracted approximately 3.4% during the same time frame. This decline in hydrocarbon-related output negatively impacted total growth by about 0.75 percentage points.

Federal statisticians officially present GDP data at constant prices, which allows for a clearer understanding of production trends without the effects of inflation. As the share of non-oil production approaches four-fifths of the total national output, its influence keeps growing. A mere 1% increase in this substantial sector contributes about 0.79 percentage points to overall GDP changes.

Strong Diversification Trends

Preliminary estimates from the Federal Competitiveness and Statistics Centre (FCSC) revealed that the share of non-oil GDP in Q1 2026 rose to 79.4%, a commendable increase of 2.1 percentage points from the previously published benchmarks. The initial figures for Q1 2025 indicated non-oil GDP growth of 5.3%, amounting to around $95.8 billion (AED 352 billion), with key sectors like manufacturing and finance showcasing notable increases of 7.7% and 7%, respectively.

The trade sector alone contributed significantly, representing 15.6% of non-oil GDP, followed closely by finance and insurance at 14.6%. Manufacturing accounted for 13.4%, while construction was responsible for 12% of the total. The latest data for Q1 2026 combines various contributing sectors, however, detailed sector breakdowns remain unavailable.

Trade Growth Bolstering the Economy

The non-oil foreign trade sector in the UAE experienced a substantial increase, reaching $527.4 billion (AED 1.937 trillion) in H1 2026, which marks a 13.1% rise from the previous year. Non-oil exports soared by 23.9%, translating to $123.3 billion (AED 452.8 billion). This reflects a growing trend in trade volumes, significantly fueled by better agreements with CEPA partners.

Among the top trade partners, China leads with $49.2 billion (AED 180.7 billion), followed by Switzerland and India. The bulk of merchandise trade came from gold exports, which surged by an impressive 48.8%. This exponential growth in trade activities strengthens multiple sectors, including customs clearance and logistics.

Ambitious National Economic Targets

The UAE has set ambitious economic targets for 2031, aiming for GDP to reach $816.9 billion (AED 3 trillion), non-oil exports to hit $217.8 billion (AED 800 billion), and total foreign trade to amount to $1.09 trillion (AED 4 trillion). As of H1 2026, non-oil exports already comprised 56.6% of the annual target.

The economic indicators for Q1 2026 highlight the commitment to bolstering non-oil activity, setting a solid benchmark for future assessments of national accounts. The continuous growth in trade and the focus on diversifying the economy affirm the UAE’s sustained commitment to reducing its dependence on oil, thereby solidifying a resilient economic future.