The year 2024 witnessed significant growth and development at the level of the financial and banking sectors and the energy sector, which enhanced the economic recovery in the UAE and contributed to the provision of thousands of new jobs, as well as increasing the salaries of employees at the government and private levels.
The Arab Monetary Fund expected the UAE’s economy to grow by 3.9% in 2024, driven by improved tourism activity, growth in international trade, increased capital spending, and the continued implementation of development plans in high-tech industries.
Economic reports also indicated that the UAE economy will continue its strong performance in 2024, with GDP growth expected at a rate ranging between 3.7% and 4.4%, supported by effective economic policies and strategic initiatives to enhance economic diversification.
In December 2024, Abu Dhabi hosted the third session of “Abu Dhabi Financial Week,” under the slogan: “Welcome to the Capital of Capital.” The event attracted more than 20,000 participants from the global financial sector, and witnessed the signing of more than 44 memorandums of understanding.
In turn, the energy sector witnessed many important developments during the year 2024, most notably the announcement in November 2024 of the establishment of the “XRG” company, which specializes in investing in energy and low-carbon chemicals.
Abu Dhabi National Oil Company (ADNOC) also announced the redirection of 200 billion dirhams ($54.45 billion) to the local economy over the next five years.
During the Abu Dhabi International Petroleum Exhibition and Conference (ADIPEC 2024), which was held last November, the UAE announced plans to invest about 200 billion dirhams to meet sustainable energy demand during the next six years, with the aim of removing carbon from the economy and achieving carbon neutrality by 2050.
As part of the UAE’s efforts to promote clean energy sources, the fourth unit of the Barakah Peaceful Nuclear Energy Plant was commissioned, which contributes to increasing the percentage of clean energy’s contribution to the national energy mix.
In addition, Abdulaziz Al Ghurair, Chairman of the Board of Directors of the UAE Banks Federation, indicated expectations that the banking sector will grow by 8% during the year 2024.
For its part, total banking assets, including bank acceptance certificates, increased by 0.5%, reaching more than 4.4 trillion dirhams at the end of September 2024, compared to about 4.37 trillion dirhams at the end of August, and total bank credit recorded an increase of 2.3%, reaching 2.16. One trillion dirhams by the end of September 2024.
As for bank deposits, they witnessed an increase of 0.8%, reaching 2.76 trillion dirhams by the end of September 2024, compared to 2.74 trillion dirhams at the end of August.
Banking reports also showed a decline in the percentage of non-performing loans since its peak in 2020.
With national banks pledging to allocate one trillion dirhams to sustainability projects by 2030, a significant increase in green financing initiatives is expected.
During the year 2024, the UAE also witnessed important developments in the tax field, as the Ministry of Finance announced that it is studying providing tax incentives to support research and development activities, and it is expected that they will come into effect in the tax periods that begin on or after January 1, 2026. It is also studying providing incentives For high-value recruitment activities, expected to be implemented as of January 1, 2025.
The Ministry announced the approval of the Council of Ministers to amend some provisions of the executive regulations for value-added tax, with the aim of enhancing transparency and compliance, and supporting the investment climate in the country. The amendments include exempting investment fund management services, some services related to virtual assets from value-added tax, and facilities for charitable and government agencies.
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