Standard Chartered Lifts UAE 2026 Growth Outlook as Trade Poised to Reach $1 Trillion

The UAE is expected to significantly outperform the global economy in 2026 after Standard Chartered raised its GDP growth forecast for the country to 5 per cent, citing strong trade performance, resilient non-oil activity and a buoyant domestic economy.

According to Standard Chartered Global Research, the revised outlook places the UAE well ahead of projected global growth of 3.4 per cent next year. The bank highlighted the country’s expanding role as a global trade connector amid increasingly fragmented supply chains.

In its latest Global Focus report, the bank upgraded its UAE growth forecast from 4 per cent to 5 per cent for 2026. The stronger projection reflects sustained momentum in non-oil sectors, favourable demographics and a thriving property market, which are expected to offset the impact of softer oil prices.

Non-oil economic activity is forecast to grow by 4.5 per cent in 2026, underpinned by domestic demand and continued diversification. The report also points to the UAE’s adaptability to shifting global trade flows as a key driver of growth.

Standard Chartered expects the UAE’s total foreign trade to reach $1 trillion in 2026, with the Asia–UAE trade corridor accounting for around one-third of that volume. This underscores the country’s growing importance in east–west trade at a time of heightened geopolitical and trade-related uncertainty.

Rola Abu Manneh, CEO of UAE, Middle East and Pakistan at Standard Chartered, said the country is on track to deliver growth at potential for a second consecutive year. She added that the UAE is rapidly cementing its status as a global “super-connector”, navigating trade fragmentation while continuing to attract capital and commerce.

The report also noted that the UAE is expected to maintain twin fiscal and current account surpluses, supported by strong domestic liquidity. Deposit growth continues to outpace private-sector credit expansion, which stood at 9.1 per cent year-on-year in mid-2025.

As a result, the UAE has the lowest loan-to-deposit ratio in the GCC, giving local banks ample capacity to expand cross-border lending. Saudi Arabia was highlighted as a key destination for such activity, where interbank rates remain elevated.

Globally, Standard Chartered raised its US growth forecast for 2026 to 2.3 per cent, up from 1.7 per cent, driven by strong business investment, corporate tax cuts and accelerating adoption of artificial intelligence. China’s 2026 growth forecast was also revised higher to 4.6 per cent, while the euro area outlook edged up modestly to 1.1 per cent.

Madhur Jha, Global Economist and Head of Thematic Research, warned that while the outlook is broadly positive, risks remain elevated due to geopolitical tensions, elections and shifting global alliances. However, he noted that faster-than-expected AI-driven productivity gains could provide upside potential to global growth.