Fitch Ratings affirmed the United Arab Emirates’ long‑term issuer default rating at AA‑ with a stable outlook on 23 May 2026.
The affirmation is based on low consolidated government debt, a strong net external asset position (sovereign net foreign assets at 164 % of UAE GDP in 2025), and high GDP per capita, while noting weak governance indicators, high geopolitical risk from the Iran‑UAE conflict, and significant leverage of government‑related entities (contingent liabilities ≈ 63 % of 2024 GDP).
Fitch expects the Strait of Hormuz to reopen gradually from July 2026; higher oil prices averaging $87 per barrel and pipeline exports to Fujairah are projected to keep Abu Dhabi’s 2026 export revenues above pre‑war levels despite lower volumes through the strait.
Real GDP is projected to contract 4.8 % in 2026, with non‑oil GDP down 3.2 % and Dubai’s GDP falling close to 7 %.
The consolidated fiscal budget is forecast to remain in surplus at 4.5 % of GDP in 2026, even though government spending is expected to rise nearly 20 % year‑on‑year to mitigate the war’s immediate impact.
Consolidated government debt is projected to increase to 27 % of GDP in 2026 from 24.3 % at end‑2025, still well below the AA‑category median debt‑to‑GDP ratio of 50.3 %.
Central Bank data show foreign‑exchange reserves fell 9 % to $277 billion in March 2026.
The current‑account balance is projected to decline to 1.3 % of GDP in 2026 from 10.6 % in 2025.
The stable outlook reflects the resilience of oil export revenues during the Iran war and the presence of ample fiscal and external buffers.
