UAE S&P Credit Rating 2025 Scores a ‘AA/A-1+’ Rating from S&P Marking Strong Growth Outlook

UAE earns a sovereign credit rating of ‘AA/A-1+’ from S&P Global for both its foreign and local currency. The UAE S&P credit rating 2025 showcases how S&P Global expects the UAE to remain fiscally strong with a stable outlook and maintain its external positions over the next two years. Furthermore, the entity sets the ⁠UAE economic growth forecast 2025-2028 to remain resilient at 4% between these years.

The UAE sovereign rating S&P Global also comes with a report that emphasizes the UAE’s substantial net asset position, which counters the increased volatility in the oil market and escalating geopolitical tensions in the Gulf area. The S&P remarks that such ratings signify a high ability to meet high financial expectations.

This report marks a historic milestone, as for the first time, S&P provided a unified UAE S&P credit rating 2025 for the UAE as a whole, and not as individual evaluations for each emirate. The UAE’s latest credit rating also marks the rising economic strength in the greater region, as earlier this year, Saudi Arabia’s rating was upgraded from ‘A’ to ‘A+’ amid the kingdom’s ongoing reforms and economic diversification.

UAE Non-Oil Sector Growth

S&P’s ⁠UAE economic growth forecast 2025-2028 of expanding at an average rate of 4% is expected to primarily be driven by growth in non-oil sectors. Despite subdued oil prices and global economic headwinds, the UAE is expected to maintain fiscal surpluses and strengthen its net asset position, which could reach around 177% of GDP by 2028.

Along with the ⁠UAE GDP 2025 outlook, the agency also shares the UAE fiscal surplus 2025 outlook in the report. To highlight, S&P projects average fiscal surpluses of 3.2% of GDP during the same period, assuming oil prices hover near $60 - $65 per barrel. Additionally, in terms of UAE government debt to GDP, public debt is anticipated to remain stable at 28% of GDP, with local currency debt issuance helping to grow the domestic capital markets.

Given the dirham’s peg to the US dollar, the UAE’s monetary policy will remain closely aligned with the US Federal Reserve. However, to lessen the load of the ⁠UAE government debt to GDP, the development of a more mature local currency bond market is still in progress.

Energy Production Set to Increase

The UAE S&P credit rating 2025 report from S&P then highlights how the UAE's non-oil economy plays a pivotal role in its growth trajectory, starting with the Central Bank of the UAE recently reporting that GDP reached AED 1.77 trillion in 2024 ($481.4 billion), up 4% year-on-year, with non-oil sectors contributing 75.5% of the total.

This growth is expected to accelerate to 4.5% in 2025 and 5.5% by 2026. Meanwhile, energy production is also set to increase. By 2028, oil output is projected to rise to 3.5 million barrels per day, with major gas projects such as Ghasha and Ruwais LNG enhancing capacity.

⁠UAE Tourism Growth 2025

Investment in tourism and culture is another promising growth engine for the UAE. Presently, the nation is working with major developments like Disney Park in Abu Dhabi, the Saadiyat cultural district, and the Wynn resort in Ras Al Khaimah. Dubai welcomed over 5.31 million international tourists in Q1 2025 and saw a 9% rise in visitors in 2024 compared to the previous year.

⁠UAE Foreign Investment Reforms

Though the proposed 50% US tariffs on steel and aluminum could impact the UAE modestly, these goods made up 4.3% of non-oil exports in 2023, meaning that the broader economic effect remains limited. Last year, such exports to the US totaled $1.4 billion, or 0.3% of GDP.

To attract global talent and capital, the UAE has introduced key reforms, including full foreign ownership in select sectors and updates to personal law. The ⁠UAE Golden Visa impact is clear, as the initiative to boost long-term residency of investors and professionals has indeed added to the country’s economic growth. These several moves are expected to enhance workforce flexibility and attract foreign talent, although they are being balanced with Emiratization policies.

⁠UAE Monetary Policy Limitations

S&P suggests the UAE’s rating could improve if it strengthens monetary policy effectiveness and deepens its domestic financial markets. Also, a downgrade is possible if per capita GDP, currently around $47,000, declines significantly due to slower growth or rapid population increases. Rising debt and external borrowing could pose further risks.

Implications for Dubai's Real Estate Market

The UAE’s newly awarded ‘AA/A-1+’ credit rating by S&P Global, along with its resilient 2025–2028 economic outlook, is poised to positively influence Dubai’s real estate sector in several key ways:

Firstly, the updated rating is projected to boost investor confidence by reinforcing UAE’s fiscal stability and low credit risk. This can encourage institutional and private investors to invest funds into Dubai’s real estate market as a safe and promising asset class.

Furthermore, the UAE will likely see increased demand for residential, commercial, and hospitality properties as non-oil sectors like tourism, culture, and finance see enhanced growth.

Finally, more foreign investors can stimulate demand for high-end and long-term housing options in Dubai’s premium districts. This comes as a result of structural reforms such as the Golden Visa program and full foreign ownership in various sectors.

Together, these developments position Dubai’s real estate market for continued growth, backed by macroeconomic stability and investor-friendly reforms.

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