In 2024, the UAE continued its emergence as a regionally vital and globally relevant financial hub, with expanding capital markets a driving force in this transition. Dubai Financial Market (DFM) was the year’s fastest-growing MENA exchange, adding around 19% to its market cap by early December, reaching AED 801 billion. ADX also continues to expand with new listings, and a market cap approaching AED 3 trillion.
All markets have their cycles, but it’s likely recent trends will continue through 2025, with local exchanges strengthening their global position, underpinned by investor confidence in the UAE economy and the strength of its businesses. Population growth, a strong real estate market, construction and infrastructure projects, tourism and hospitality, and increasing retail sales all provide added reasons for optimism.
In a global comparison, the UAE moves into the new year offering investors an appealing proposition. The economic outlook remains favourable, with the Central Bank of the UAE (CBUAE) indicating real GDP growth of around 4.0% in 2024, increasing to 6.0% in 2025. Non-oil GDP, seen as a short-hand measure for economic diversification, is estimated at 5.2% for 2024, rising slightly to 5.3% in 2025.
By contrast, global growth has been estimated by the International Monetary Fund (IMF) at around 3.2% for 2024 and 3.3% for 2025, and by the World Bank at 2.6% and 2.7% respectively. US growth estimates are below 3.0% from most sources, while the UK and EU are barely achieving 1.0%.
This growth imbalance highlights a clear investor advantage in directing capital into the UAE. Exposure to the property sector offers potential, given a continuing real estate surge and population-driven demand. Population growth, especially of higher-income expats, is also boosting consumer spending, which is positive for the retail sector, as well as for telecoms, tourism and hospitality.
Derek Nicholson
Chief Strategy & Investor Relations Officer
Domestic and regional equities provide immediate access to a high-performing economy, give businesses additional funds for growth, and founders and existing private shareholders a means to unlock liquidity. In the year ahead, these factors will help maintain the buoyant IPO activity, which, along with Saudi Arabia, makes the UAE one of the world’s most dynamic locations for new listings.
Many companies are following this now well-established path. Firms raised USD 13 billion from initial public offerings in 2024.
Significant listings included NMDC Energy, Lulu Retail, Parkin, Spinneys, Talabat – which was the UAE’s largest private sector IPO – ADNH Catering, and construction firm Drake & Scull International. Anticipated listings for the coming year include FIVE Holdings and Dubizzle Group. In 2025, Etihad Airlines is also expected to become the first Gulf hub carrier to go public, and reports indicate that Dubai Holding is considering listings for parts of its business.
The calendar continues a trend toward public listings of marquee government-related entities. It also includes a good selection of private-sector companies that add range and depth to the equity offering, and companies are now consistently choosing Abu Dhabi or Dubai as a location for their primary listing, rather than an established centre such as London. While many retain a secondary listing abroad, the centre of gravity has definitively shifted onto home ground.
The next evolution, and one that may be at a tipping point, will be enticing more foreign investors, particularly institutional ones, to bring funds into the UAE market as part of their global strategy. While up-to-date data on foreign holdings of UAE shares is limited, and many companies are subject to foreign ownership limits, there is a significant group of listings where shares are 100% available to outside buyers. Even for those with restrictions, there is typically a significant gap between the actual foreign holdings and what is allowed.
Official policy supports increasing foreign investment across the economy, including regulatory reforms, changes in labour laws, new visa options, and what is still a favourable tax regime despite the introduction of a corporation tax at the start of 2024. The country’s financial markets are also collaborating with listed companies and international investment banks to host global investor conferences, sustaining a strong presence of institutional and foreign investments in the markets.
The numbers show these polices are gaining traction. Emirati enterprises welcomed around 63,000 new investors in just 2023, 47% of whom were foreign. In May 2024, around 19,000 institutional investors were registered with ADX, with 43% being foreign. If 2025 brings an increase in those percentages, the UAE will take an important step forward in its ambitions as global finance hub.