UAE Non-Oil Sector Sees Strong Growth in February

Mar 4, 2026

77 min

Mar 4, 2026 09:31

UAE non-oil business growth reaches a one-year high on strong demand

## Surge in Business Activity

The UAE's non-oil private sector experienced significant growth in February, marking the highest expansion in a year. This surge was driven by increased demand, new orders, and improved supply chain conditions. The S&P Global UAE Purchasing Managers’ Index rose to 55.0, indicating robust business conditions.

## Key Drivers of Growth

The growth was fueled by a rise in new orders, supported by tourism, e-commerce, and interest in AI products. Domestic demand played a major role, with international demand contributing modestly. The increase in new projects led to a backlog of work, highlighting strong inflows and some administrative delays.

## Employment and Inventory Trends

In response to the growing workload, companies expanded their workforce, marking the highest employment rise since November. Firms also increased their inventories, benefiting from improved supplier delivery times, which helped them meet rising demand.

## Easing Cost Pressures

February saw a slowdown in input cost inflation, providing relief to businesses. This was partly due to a decrease in fuel prices, although some raw material costs remained high. Selling prices continued to rise, albeit at a modest pace due to strong competition.

## Dubai's Continued Expansion

Dubai's non-oil sector also grew, though at a slightly reduced pace compared to January. The Dubai PMI fell to 54.6, still reflecting solid growth. The emirate saw new opportunities in tourism, population growth, and AI technologies, with employment rising at the fastest rate in two years. Cost pressures in Dubai eased, with input costs increasing at the slowest rate in seven months.

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