UAE's Non-Oil Private Sector Continues Rapid Growth in 2025

At the beginning of 2025, the UAE's non-oil private sector was still growing rapidly, despite competitive difficulties and capacity constraints. According to the Sources. In January, the seasonally adjusted S&P Global UAE Purchasing Managers' Index was 55.0, which was significantly over the 50.0 threshold, indicating expansion, but somewhat below the nine-month high of 55.4 in December. Favorable market conditions and lessening cost constraints drove a substantial increase in business activity and new orders, albeit at a little slower pace. The new orders subindex eased to 59.0 in January from 59.3 in December.

"Robust expansions in activity and new business, as well as lower input cost inflation, suggest the economy is in a healthy position," said David Owen, Senior Economist at S&P Global Market Intelligence.

Businesses were able to increase purchases as input cost inflation dropped to a 13-month low, but capacity constraints remained, as work backlogs increased at their quickest rate in eight months.

Owen stated that overall confidence was at its lowest point since December 2022. "Strong competition and cash flow concerns arising from heavy backlogs have appeared to sow doubt among firms that they can continue to boost their revenues," he added.

Dubai's separate index decreased marginally from December's 55.5 to 55.3 as companies reported better conditions but had cautious forecasts for future growth.