S&P Global Ratings affirmed the sovereign credit rating of the United Arab Emirates at AA for long term and A-1+ for short term foreign and local currency debt, maintaining a stable outlook that reflects the country’s strong financial buffers and economic resilience.
The agency said the UAE’s substantial fiscal and external reserves give policymakers flexibility to respond to geopolitical tensions or potential volatility in the hydrocarbon sector. These buffers help cushion the economy against disruptions in oil production or exports.
According to the report, the UAE’s government balance sheet remains exceptionally strong. S&P estimates the government’s consolidated net asset position will reach about 184 percent of GDP in 2026. Government liquid assets are projected at roughly 210 percent of GDP, providing significant protection against external shocks.
Public debt levels remain relatively low. S&P estimates general government debt at about 27 percent of GDP in 2026. The country’s fiscal position has also been robust, with the consolidated fiscal balance recording an average surplus of 5.6 percent between 2021 and 2025.
Economic diversification continues to strengthen the outlook. Non oil sectors now account for around 75 percent of GDP, reducing the economy’s exposure to swings in global energy markets. Government investments and sovereign wealth funds also play a central role in supporting financial stability.
The agency noted that the UAE banking sector has shown strong resilience in recent years. Banks are expected to benefit from continued growth in the non oil economy, with solid loan expansion forecast through 2026 and 2027.
S&P added that ample liquidity and potential monetary policy easing should further support lending activity across the banking system.
News Source: Emirates News Agency
