Dubai continues to demonstrate Dubai’s fiscal resilience as it avoids major increases in debt issuance through 2028. According to a new S&P report, the emirate’s strong economic growth and fiscal surpluses will allow it to maintain stability despite ambitious infrastructure plans.
S&P projects Dubai’s total public sector debt, including government-related entities, to remain around 64% of GDP in 2025. The figure reflects years of prudent fiscal management and consistent economic performance. Over the past three years, Dubai has reduced its debt significantly while maintaining robust growth in services and trade. This achievement underscores Dubai’s fiscal resilience and its commitment to financial stability.
Although several large-scale infrastructure projects are underway, the emirate plans to manage financing efficiently. Key initiatives include the AED35 billion ($9.5 billion) Al Maktoum International Airport expansion, the AED30 billion Tasreef rainwater drainage project expected by 2033, and the AED20.6 billion Dubai Metro expansion. Instead of relying heavily on new debt, Dubai aims to use phased funding, public-private partnerships, and alternative financing models.
S&P expects the Dubai Debt Management Office to continue using strategic financial tools to limit borrowing. The report also highlights the government’s disciplined repayment record. By June 2025, total outstanding government debt was AED112.4 billion, or about 20% of GDP. In the first half of the year, the government repaid AED18.8 billion, including part of a major Emirates NBD loan.
Furthermore, S&P anticipates Dubai’s gross general government debt will stabilize after falling from 32% in 2024. This marks a sharp improvement from its 2020 peak of 79%. The agency assumes Dubai will repay commercial debt on time while maintaining its joint facilities with Abu Dhabi and the UAE Central Bank.
Dubai’s economy remains one of the most diversified in the region. Real GDP growth is projected to average 2.9% between 2025 and 2028. This growth stems from strong tourism, logistics, and financial sectors. Notably, Dubai’s economy expanded 3.2% in 2024, outperforming the Gulf Cooperation Council average of 1.5%.
Inflation is expected to remain modest at around 2.5% to 3% during the same period. The UAE dirham’s peg to the US dollar continues to support price stability and market confidence.
With sound fiscal policies, manageable debt levels, and continuous diversification, Dubai’s fiscal resilience remains a defining feature of its long-term economic outlook. The emirate’s balanced approach ensures that progress continues without compromising financial strength.
