UAE Emirate avoids recession as Fitch cites low debt and surging trade growth

Fitch Ratings affirmed Ras Al Khaimah’s Long-Term Issuer Default Rating (IDR) at ‘A+’ on Sunday, 4 October, citing the emirate’s low public debt and substantial fiscal buffers. The agency also removed the emirate from 'Rating Watch Negative', citing an easing of direct geopolitical risks that surfaced in April 2026. GDP growth forecast revised upward The ratings agency revised its 2026 real GDP growth forecast for Ras Al Khaimah to 1.5 per cent. This represents a significant upgrade from its previous projection, which had anticipated a 1.8 per cent contraction. The revision follows data from the first half of 2026 showing resilient domestic demand and increased trade activity within the Gulf region. Fitch expects the emirate’s economic expansion to accelerate to 5 per cent in 2027. Consolidated public-sector debt is projected to remain stable at approximately 11 per cent of GDP through the 2026–2028 period. The agency noted that while regional uncertainty caused a slight delay and a marginal cost increase for a major investment project, the overall impact on the emirate's credit profile was limited. Fiscal resilience and federation benefits The ‘A+’ rating is underpinned by Ras Al Khaimah’s high GDP per capita and its membership in the UAE federation. According to a spokesperson for the Ras Al Khaimah Government, the rating affirmation and the removal of the negative watch status reflect the strength of a diversified economy that includes small and medium enterprises…