The Middle East is poised for a significant economic transformation in 2025, with countries across the region intensifying their diversification strategies to reduce reliance on oil revenues. Saudi Arabia, the United Arab Emirates (UAE), and other Gulf Cooperation Council (GCC) nations are implementing robust measures to foster growth in non-oil sectors, aiming for sustainable economic futures.
Saudi Arabia’s Public Investment Fund (PIF) has committed $200 million as a seed investor in the SPDR JPMorgan Saudi Arabia Aggregate Bond UCITS ETF, marking the kingdom’s inaugural bond ETF listed in Europe or the United States. This investment underscores Saudi Arabia’s dedication to diversifying its economy and attracting international capital.
In a strategic move to bolster its economic ties with the United States, Crown Prince Mohammed bin Salman announced plans for Saudi Arabia to invest at least $600 billion in the U.S. over the next four years. This initiative aims to strengthen bilateral relations and stimulate economic growth through substantial investments.
The UAE’s economy is projected to grow by 5% in 2025, driven by its ongoing economic diversification efforts. This growth is attributed to the expansion of non-oil sectors, infrastructure investments, and strategic initiatives aligned with the UAE Centennial 2071 vision.
The GCC economies are collectively expected to achieve a 4% growth in 2025, supported by increased oil production and a steady performance in non-oil sectors. This growth reflects the region’s commitment to economic diversification and resilience.
Saudi Arabia’s non-oil private sector experienced a 4.9% growth in the second quarter of 2024, the strongest in a year, driven by sectors such as trade and hospitality. This performance is expected to accelerate to 4.4% by 2025, reinforcing the kingdom’s economic resilience.
