Introduction
The second pillar of We the UAE 2031, officially titled Forward Economy, sets forth the most ambitious economic transformation agenda in the federation’s history. This pillar targets the doubling of national GDP from approximately AED 1.68 trillion to AED 3 trillion by 2031, with non-oil sectors contributing 80% or more of total output. The pillar encompasses industrial policy, trade expansion, digital economy development, SME support, innovation ecosystem building, Emiratisation, foreign direct investment attraction, tourism growth, and financial services modernisation.
The economic diversification imperative is not new to UAE strategic planning. Since the early 2000s, successive governments have pursued deliberate strategies to reduce dependence on hydrocarbon revenues. Abu Dhabi’s Economic Vision 2030 and Dubai’s Industrial Strategy 2030 each advanced sectoral diversification at the emirate level. We the UAE 2031 consolidates these efforts into a unified federal framework, establishing national targets that transcend individual emirate ambitions while preserving the competitive dynamism that has historically characterised inter-emirate economic relations.
GDP Doubling Target
The headline economic target of AED 3 trillion in nominal GDP by 2031 requires a compound annual growth rate of approximately 7.5% from the 2022 baseline. This growth trajectory demands contributions from both existing sectors and entirely new industries. The target is calibrated against projections for population growth, labour force expansion, productivity improvements, and capital investment.
Hydrocarbon revenues, while declining as a share of GDP, remain a significant contributor in absolute terms. Abu Dhabi’s ADNOC continues to invest in upstream capacity expansion and downstream value addition, with a production capacity target of five million barrels per day. The strategy positions oil and gas revenues as a financing mechanism for diversification rather than an end in themselves, a paradigm articulated through the Mubadala Investment Company’s mandate to deploy hydrocarbon wealth into knowledge-economy assets globally.
Non-Oil Diversification
The target of 80% or higher non-oil GDP share by 2031 represents an acceleration of a long-established trend. Non-oil sectors accounted for approximately 73.2% of GDP at the time of the vision’s announcement, with financial services, real estate, construction, tourism, logistics, and manufacturing as the primary contributors.
| Economic Sector | GDP Contribution (2024) | 2031 Target Share |
|---|---|---|
| Financial Services | 12.1% | 14% |
| Real Estate & Construction | 13.8% | 12% |
| Manufacturing & Industry | 9.2% | 13% |
| Tourism & Hospitality | 5.1% | 7% |
| Digital Economy | 9.7% | 20% |
| Trade & Logistics | 15.3% | 16% |
| Oil & Gas | 26.8% | <20% |
| Other Services | 8.0% | 8% |
Structural diversification requires more than sectoral rebalancing. The vision emphasises the transition from a factor-driven economy to one powered by innovation and knowledge. This transition demands investments in human capital, research infrastructure, intellectual property frameworks, and technology transfer mechanisms that can sustain productivity growth beyond what labour and capital accumulation alone can deliver.
Operation 300bn: Industrial Strategy
Operation 300bn, launched in March 2021, targets the expansion of industrial GDP from AED 133 billion at the time of launch to AED 300 billion by 2031. The strategy focuses on advanced manufacturing, food production, pharmaceuticals, medical devices, defence manufacturing, space technology, and clean energy equipment. The Ministry of Industry and Advanced Technology (MoIAT) oversees the programme, which incorporates regulatory reform, infrastructure development, supply chain localisation, and technology adoption incentives.
The Make it in the Emirates initiative serves as the commercial activation arm of Operation 300bn, connecting international manufacturers with local supply chain partners and facilitating industrial investment. The Emirates Development Bank (EDB) provides concessional financing to industrial enterprises, with a particular focus on small and medium-sized manufacturers seeking to scale production capacity.
Key industrial clusters include KIZAD (Khalifa Industrial Zone Abu Dhabi), Jebel Ali Free Zone (JAFZA), Ras Al Khaimah Economic Zone (RAKEZ), and Sharjah’s Hamriyah Free Zone. These zones offer integrated logistics, regulatory simplification, and co-location advantages that reduce operating costs for manufacturers.
| Industrial KPI | Baseline (2021) | Current (2025) | 2031 Target |
|---|---|---|---|
| Industrial GDP | AED 133 Billion | AED 197 Billion | AED 300 Billion |
| Number of Industrial Facilities | 33,000 | 42,000 | 55,000 |
| Industrial Exports | AED 155 Billion | AED 210 Billion | AED 350 Billion |
| In-Country Value (ICV) | 36% | 44% | 55% |
| 4IR Technology Adoption | 22% | 38% | 60% |
Digital Economy
The digital economy represents the single largest growth opportunity within the economic pillar. We the UAE 2031 targets digital economy contribution reaching 20% of GDP, a transformative expansion driven by artificial intelligence, cloud computing, fintech, e-commerce, blockchain applications, and digital government services.
The UAE Strategy for Artificial Intelligence, originally announced in 2017, has been updated to reflect advances in generative AI and large language models. The appointment of the world’s first Minister of State for Artificial Intelligence in 2017 signalled the government’s intent to lead in AI adoption. The Mohamed bin Zayed University of Artificial Intelligence (MBZUAI) anchors the research ecosystem, while regulatory sandboxes operated by the Abu Dhabi Global Market (ADGM) and Dubai International Financial Centre (DIFC) enable controlled experimentation with emerging technologies.
The digital infrastructure backbone includes nationwide 5G coverage, achieved in 2025, the establishment of hyperscale data centres by major international providers, and the Digital Government Strategy that targets 100% digital delivery of federal government services.
SME Development
Small and medium enterprises constitute over 94% of registered businesses in the UAE and employ approximately 86% of the private sector workforce. Under We the UAE 2031, the SME sector is targeted for expanded access to financing, reduced regulatory burden, enhanced market access, and improved technology adoption.
The Khalifa Fund for Enterprise Development, the Mohammed bin Rashid Fund for SMEs, and the Emirates Development Bank collectively manage a portfolio of financing instruments including equity investments, concessional loans, credit guarantee schemes, and venture capital co-investment programmes. The target is to increase SME contribution to GDP from approximately 53% to 60% by 2031.
Regulatory reforms include the streamlined commercial licensing system introduced through the National Economic Register, the reduction of minimum capital requirements for company formation, and the expansion of 100% foreign ownership eligibility across most economic sectors.
Innovation Ecosystem
Research and development spending as a share of GDP is targeted to increase from approximately 1.3% to 2.0% by 2031, aligning with OECD averages. The vision establishes a National Research and Innovation Fund, administered through the Ministry of Education and the Advanced Technology Research Council (ATRC), to finance basic and applied research in priority domains including energy, health sciences, agriculture technology, space, and artificial intelligence.
Technology transfer mechanisms connect university research outputs with commercial applications. The Hub71 technology ecosystem in Abu Dhabi and the Dubai Future District serve as physical and institutional platforms for startup incubation, venture capital deployment, and corporate innovation partnerships.
Emiratisation
The Emiratisation programme, significantly expanded since 2022, mandates private sector companies with 50 or more employees to maintain a 2% annual increase in Emirati employment. The NAFIS programme provides salary supplements, training subsidies, and pension contributions to facilitate Emirati employment in the private sector. The programme targets the employment of 75,000 Emiratis in the private sector by 2026, with continued expansion through 2031.
Compliance enforcement has been strengthened through financial penalties for non-compliant companies and preferential treatment in government procurement for firms exceeding Emiratisation targets. The programme represents a deliberate effort to redistribute the demographic balance of the private sector workforce, which has historically been dominated by expatriate labour.
Foreign Direct Investment
FDI attraction targets under We the UAE 2031 call for annual inflows exceeding USD 30 billion, up from approximately USD 22.7 billion at the time of announcement. The UAE consistently ranks among the top FDI destinations in the Middle East and North Africa region, supported by its free zone infrastructure, bilateral investment treaty network, and regulatory transparency.
The Invest in the UAE programme, managed by the Ministry of Economy, provides a unified entry point for international investors, offering sector-specific guidance, regulatory navigation support, and incentive package information. The expansion of Comprehensive Economic Partnership Agreements (CEPAs) with key trading partners, including India, Turkey, Indonesia, Israel, and others, provides preferential market access that enhances the UAE’s attractiveness as a regional hub for multinational operations.
Non-Oil Foreign Trade
Non-oil foreign trade targets under the vision call for expansion from AED 2.88 trillion to AED 4 trillion by 2031. The UAE’s position as a global trade hub is underpinned by its port infrastructure (Jebel Ali, Khalifa Port, Fujairah), airport capacity (DXB, DWC, AUH), and free zone network (more than 40 operational free zones).
The CEPA programme is central to trade expansion. Each agreement reduces tariff barriers, harmonises standards, and facilitates the movement of goods, services, and capital between the UAE and partner countries. By early 2026, the UAE had signed or was negotiating CEPAs with more than 15 countries spanning Asia, Africa, Europe, and Latin America.
Tourism
The tourism sector targets 40 million international arrivals by 2031, up from 29.4 million. Dubai, Abu Dhabi, and Ras Al Khaimah lead emirate-level tourism strategies, with investments in hotel infrastructure, entertainment venues, cultural attractions, and adventure tourism. The Dubai Tourism Strategy 2031 and Abu Dhabi’s Tourism Strategy 2030 establish emirate-specific targets that feed into the national aggregate.
Event-driven tourism, including major exhibitions, conferences, sporting events, and cultural festivals, complements leisure and business travel segments. The UAE’s position as a global aviation hub, with Emirates, Etihad, and flydubai operating extensive route networks, provides the connectivity infrastructure essential for tourism growth.
Financial Services and Fintech
The financial services sector is targeted for modernisation through digital banking adoption, fintech ecosystem development, and the expansion of the UAE’s role as a regional and global financial centre. ADGM and DIFC together host more than 4,000 registered entities, including banks, insurance companies, asset managers, fintech firms, and professional services providers.
The Central Bank of the UAE has introduced regulatory frameworks for digital banking, open banking, stored value facilities, and cryptocurrency exchanges. The digital dirham project, a central bank digital currency (CBDC) initiative, is progressing through pilot phases with planned full deployment aligned with the 2031 timeline.
Conclusion
The economic pillar of We the UAE 2031 represents an integrated strategy to transform the federation’s economic structure from resource dependence to knowledge-driven growth. The targets are ambitious by any international benchmark, requiring sustained policy coordination, massive capital deployment, human capital development, and institutional reform. The achievement of these targets would position the UAE among the world’s most diversified and competitive economies, fundamentally altering its economic profile within less than a decade.