The UAE targets a digital economy contribution of 20 per cent of non-oil GDP by 2031, up from approximately 9.7 per cent in 2022. This target encompasses direct technology sector output (software, hardware, IT services), the digital transformation of traditional industries, and the economic value generated through government digital services, fintech, e-commerce, and emerging fields including artificial intelligence and blockchain applications.
Target vs. Actual Performance
| Year | Target (% of Non-Oil GDP) | Actual (%) | Gap (pp) | Status |
|---|---|---|---|---|
| 2022 | — (Baseline) | 9.7 | — | Baseline |
| 2023 | 11.5 | 11.2 | -0.3 | Marginal |
| 2024 | 13.5 | 12.8 | -0.7 | At Risk |
| 2025 | 15.0 | 14.2 (est.) | -0.8 | At Risk |
| 2026 | 16.5 | — | — | Pending |
| 2031 | 20.0 | — | — | Target |
Digital Economy Components (2024)
| Component | Value (AED Bn) | Share of Digital Economy (%) | Growth (YoY) |
|---|---|---|---|
| IT services and consulting | 48.2 | 24.3% | +9.8% |
| E-commerce and digital retail | 42.6 | 21.5% | +14.2% |
| Telecommunications | 38.4 | 19.4% | +4.1% |
| Fintech and digital payments | 28.1 | 14.2% | +18.6% |
| Software and app development | 18.6 | 9.4% | +16.3% |
| Cloud and data services | 12.8 | 6.5% | +22.4% |
| AI and emerging technology | 9.4 | 4.7% | +28.1% |
Progress Rate Analysis
The digital economy has been the fastest-growing segment of the UAE’s non-oil output, with the AI and cloud sub-sectors leading at growth rates exceeding 20 per cent annually. Despite this pace, the gap against the 20 per cent target has widened slightly because the denominator — total non-oil GDP — has also been growing strongly, making the percentage target harder to hit.
In absolute terms, the digital economy is performing well. The establishment of the Abu Dhabi AI Council, the Dubai AI Campus, and Microsoft and Google cloud region deployments in the UAE have created genuine technology ecosystem momentum. The UAE’s per capita digital adoption metrics — mobile penetration, e-government service usage, digital payment adoption — rank among the highest globally.
Key Enablement Metrics
| Metric | 2022 | 2024 | Global Rank |
|---|---|---|---|
| Internet penetration | 98.0% | 99.2% | 3rd |
| 5G coverage | 62% | 88% | 8th |
| E-government usage | 91.4% | 94.8% | 5th |
| Digital payment adoption | 68% | 82% | 14th |
| Cloud infrastructure investment ($Bn) | 1.2 | 2.8 | Regional 1st |
Risk Factors
| Risk | Severity | Impact |
|---|---|---|
| Talent shortage in advanced technology | High | Constrains sector growth ceiling |
| AI regulatory uncertainty | Medium | May slow enterprise adoption |
| Cybersecurity vulnerabilities | Medium | Undermines digital trust framework |
| Global tech sector correction | Medium | Reduces investment flows |
| Measurement methodology gaps | Low-Medium | Digital economy definition evolving |
Outlook
The 20 per cent of non-oil GDP target is ambitious and faces the mechanical challenge of a growing denominator. However, the structural shift toward digital adoption across all sectors — financial services, government, healthcare, education, and logistics — supports continued above-average growth. The UAE’s competitive advantages in infrastructure quality, regulatory responsiveness, and expatriate talent attraction position it as the leading digital economy in the Middle East. Reaching exactly 20 per cent by 2031 may prove difficult; a more realistic estimate is 17-19 per cent, which would still represent a transformational shift.
Current Assessment: At Risk — strong absolute growth but percentage target mechanically challenging.