Fitch Ratings has affirmed Abu Dhabi’s Long-Term Issuer Default Ratings at ‘AA’ with a Stable Outlook, pointing to the emirate’s high GDP per capita and very strong fiscal and external position. The rating action commentary was published on 31 October 2026 and reported on 1 November by Gulf News and Arab News.
What happened
According to Fitch’s commentary, Abu Dhabi’s government debt is among the lowest of all Fitch-rated sovereigns, while its sovereign net foreign assets are among the highest. The agency said the Stable Outlook reflects the resilience of oil export revenue during the US-Iran war, which is allowing the emirate to keep building its fiscal and external buffers.
Fitch also listed the factors holding the rating back: high dependence on hydrocarbons, an economic policy framework it describes as relatively weak but improving, geopolitical risks and governance indicators that are low compared with peers.
In a technical change, Fitch is withdrawing the separate Country Ceiling it kept for Abu Dhabi. The UAE’s Country Ceiling, currently ‘AA+’, now applies to the emirate. Fitch said this does not change the ceiling that applies to Abu Dhabi-based issuers, because the two had already been equalised.
Key figures
- 300% of GDP: Fitch’s estimate of Abu Dhabi’s sovereign net foreign assets at the end of 2025, mostly held by the Abu Dhabi Investment Authority (ADIA). The median for ‘AA’ sovereigns is 45.1%.
- 19.3% of GDP: government debt at the end of 2025, against an ‘AA’ median of 46.5%.
- 2.3% of GDP: forecast 2026 budget surplus excluding ADIA investment income, or 7.1% on a general government basis including it.
- 4.2 million barrels per day: projected oil production in 2027, as conditions around the Strait of Hormuz normalise and a second Fujairah pipeline opens around mid-year.
- 15.1%: forecast headline GDP growth in 2027, which Fitch calls a long-term high, after 3.7% in 2026.
Fitch’s baseline assumes a durable deal reopens the Strait of Hormuz around the first quarter of 2027, with Brent crude averaging USD 70 per barrel in 2027 and USD 60 in 2028.
Why it matters for UAE businesses
A stable sovereign rating supports confidence in the wider financial system. Fitch said Abu Dhabi’s banks have been resilient to the war, with solid liquidity and capital buffers. It flagged real estate lending as the most likely source of stress only under a severe scenario, and noted that the emirate’s flagship banks have limited concentration in corporate real estate.
Two further points are relevant for companies planning to raise money. First, Fitch expects projected surpluses to flow to government-related entities with long-term development mandates and to deposits at local banks, which supports liquidity in the domestic system. Second, it said government borrowing will increasingly focus on local currency to help develop the domestic debt market. A deeper dirham bond and Sukuk market can, over time, give corporates more reference pricing and more local options for funding.
Fitch did caution that Abu Dhabi has larger contingent liabilities than peers, estimating government-related entity debt at over 48% of GDP in 2025, although it views this as manageable given the emirate’s buffers.
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Sources: Fitch Ratings rating action commentary “Fitch Affirms Abu Dhabi at ‘AA’; Outlook Stable”, 31 October 2026 (via Zawya); Gulf News and Arab News, 1 November 2026.
By the National Finance Media Team