S&P Global has reaffirmed Abu Dhabi’s credit rating at a formidable “AA/A-1+” in both local and foreign currencies, emphasizing a stable outlook. The credit rating agency predicts the Emirate’s fiscal and external positions will remain robust in the coming years, attributing this strength to prudent policymaking and positive assumptions about the hydrocarbon sector. Abu Dhabi’s oil production is expected to grow in the medium term, reaching 5 million barrels per day by 2027, a significant increase from the current 4 million bpd. Despite an anticipated short-term decline in oil production due to OPEC+ supply cuts in 2023, the report notes a bounce-back in subsequent years, with the government’s net asset position estimated at 336 percent of GDP in 2023, providing a solid buffer against economic uncertainties.
Abu Dhabi’s economic resilience is underscored by its 9.3 percent growth in 2022, driven by a robust hydrocarbon sector contributing 50 percent to the total GDP increase. The nonhydrocarbon sector also played a pivotal role, growing by 8.4 percent. S&P Global highlights the Emirate’s economic recovery to 2019 levels, emphasizing the diversification of sectors such as manufacturing, construction, financial services, and public administration. Despite an expected 0.4 percent contraction in economic growth in 2023, attributed to tighter monetary policies, the nonhydrocarbon sector is predicted to grow by about 4 percent. Looking ahead, the hydrocarbon sector is anticipated to recover by close to 10 percent in 2024, fostering an overall economic expansion of approximately 6.5 percent.