UAE economy contracts in second quarter as regional conflict hits tourism and trade
The UAE’s real gross domestic product fell 2.1% year on year in the second quarter of 2026 to AED476.9 billion ($130 billion), as disruptions linked to the regional conflict weighed on tourism, transport and trade, according to preliminary estimates from the Federal Competitiveness and Statistics Centre (FCSC).
Non-oil activities contracted by 1.1% in the quarter ended June 30, though they continued to account for a growing share of the economy, rising to 79.2% of real GDP in the first half of 2026, up from 78.1% a year earlier. Oil activities made up the remaining 20.8%, down from approximately 23% in the same period of 2025.
For the first half of 2026 as a whole, real GDP reached AED961.9 billion at constant prices, a modest increase of 0.4% on the same period in 2025, supported by non-oil GDP growth of 1.8%. The FCSC said the results reflect continued diversification of the UAE’s economic base, with non-oil sectors driving the bulk of activity.
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Muhammad Ali Bandial