Dhaman: The Arab Investment and Export Credit Guarantee Corporation (Dhaman) announced that the Arab GDP is projected to grow by 5.6 percent, reaching approximately USD 4 trillion by 2026, fueled by anticipated growth across 19 Arab economies. This includes eight oil-exporting countries that contribute over 70 percent of the total Arab GDP.
According to Kuwait News Agency, Dhaman's press release coinciding with the issuance of its fourth quarterly bulletin, "Dhaman Al-Istithma 2025," highlighted that the Arab GDP achieved about USD 3.8 trillion in 2025, marking a 1.7 percent increase despite regional geopolitical challenges. Notably, Saudi Arabia, the UAE, Egypt, Algeria, and Iraq accounted for nearly 73 percent of this total.
The International Monetary Fund's estimates revealed that Arab economic indicators in 2025 were mixed due to fluctuating oil prices and ongoing geopolitical and economic issues. In terms of purchasing power parity, Arab GDP rose by 6.1 percent, exceeding USD 9.8 trillion, with projections to surpass USD 10 trillion by 2026.
GDP per capita experienced a slight decline of 0.3 percent to USD 7,806 in 2025 but increased by 4 percent in purchasing power parity, surpassing USD 20,000. This reflects significant disparities between oil-rich and lower-income countries.
The regional unemployment rate decreased to 9.4 percent in 2025 and is expected to further decline to 9.2 percent in 2026. Inflation also reduced to 10.3 percent and is projected to be 8.1 percent next year.
Dhaman observed an improvement in annual average exchange rates for seven Arab currencies against the US dollar, including those of Tunisia, Qatar, UAE, Morocco, Algeria, Djibouti, and Syria.
The aggregate Arab budget deficit saw a 53 percent increase to USD 95 billion in 2025, representing 2.5 percent of GDP. This was influenced by a 13 percent drop in oil prices, averaging USD 69 per barrel, with a slight decline expected in 2026 to USD 94.5 billion.
Total investments in 14 Arab countries rose by 5.2 percent to USD 864 billion in 2025, representing 27.3 percent of their GDP, with projections to exceed USD 910 billion in 2026.
Debt indicators showed that government debt stood at 46.2 percent of GDP in 2025, with expectations to rise above 47 percent in 2026. Meanwhile, external debt reached 54.6 percent, with a slight increase anticipated next year.
Arab foreign exchange reserves grew by 3.4 percent to USD 2.1 trillion, covering roughly 5.5 months of imports, and are expected to rise by 2.5 percent in 2026, covering 5.7 months of imports.
Dhaman, a joint Arab entity owned by Arab states and four Arab financial institutions, was established in 1974 and is headquartered in Kuwait.