GCC Debt Issuance to Cross $1.25 Trillion in 2026, Fitch Says
Gulf Cooperation Council (GCC) countries are expected to issue more than $1.25 trillion in debt by 2026, according to a new report from Fitch Ratings. The region will remain one of the world’s largest emerging-market issuers of US dollar debt and sukuk (Islamic bonds).
Fitch said the growth in GCC debt will come from several sources. These include refinancing old debt, funding budget deficits, paying for major infrastructure projects, and efforts by governments to develop local debt markets. The agency also said that lower oil prices and expected US interest-rate cuts could support more borrowing.
Fitch expects Brent oil prices to average $63 per barrel in both 2026 and 2027. It also forecasts that the US Federal Reserve will reduce interest rates to 3.25% in 2026 and 3% in 2027, making borrowing cheaper.
Bashar Al Natoor, Fitch’s Global Head of Islamic Finance, said that most GCC borrowers continued to have strong access to global markets during 2025 and early 2026, even with global and regional challenges.
He noted that sukuk now account for more than 40% of outstanding GCC debt, the highest level ever. Around 84% of Fitch-rated GCC sukuk are investment-grade, and 90% of issuers have stable outlooks. There were no sukuk defaults or credit downgrades, while several Omani sukuk were upgraded after Oman’s sovereign rating improved.
In 2025, GCC countries were among the largest emerging-market debt issuers worldwide, making up 35% of all emerging-market US dollar debt issuance, excluding China. Fitch also said that dollar-denominated sukuk grew faster than conventional bonds during the year.
Many issuers, especially in Saudi Arabia, are now using other financing options such as private credit, syndicated loans, and certificates of deposit, instead of relying only on bond markets.
Overall, the total GCC debt market grew by more than 14% year-on-year to reach $1.1 trillion. However, Fitch said the market is still uneven. Saudi Arabia and the UAE have the most developed debt markets in the region.
Kuwait returned to international markets after eight years, issuing $11.25 billion in sovereign bonds. Oman’s debt market is expected to grow more slowly as the country focuses on reducing debt. Qatar and the UAE have also started issuing digital notes, showing early steps toward tokenized debt.
Despite strong growth prospects, Fitch warned that GCC debt markets remain exposed to risks such as oil price changes, interest-rate movements, geopolitical tensions, and changes in sharia rules for sukuk.
On the economic side, the World Bank expects GCC economic growth to rise to 4.4% in 2026 and 4.6% in 2027, mainly driven by non-oil sectors.
Qatar is forecast to grow the fastest, followed by the UAE, Saudi Arabia, and Oman, showing a strong outlook for the region’s economy in the coming years.
Published: 23th January 2026
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