Abu dhabi: The International Monetary Fund (IMF) staff concluded their visit to the United Arab Emirates, highlighting the nation's economic resilience in the face of geopolitical conflict in the Middle East. "The UAE economy has demonstrated significant resilience amid the geopolitical conflict in the Middle East," the IMF noted in its findings, attributing this to sound economic fundamentals, ample policy buffers, and a swift policy response that successfully contained the overall impact of the shock. According to International Monetary Fund, the UAE's authorities implemented timely and well-targeted support measures that have preserved financial stability, safeguarded essential supply chains, supported affected sectors and households, and sustained market confidence. Despite the ongoing uncertainty regarding the duration and intensity of the conflict, and the intermittent closure of the Strait of Hormuz impacting activity, the IMF expects the UAE economy to rebound in the latter half of the year. This rec overy is anticipated as exports increase and OPEC+ quotas cease to be restrictive, even though a slight GDP decline is expected in 2026 due to a slowdown in non-hydrocarbon activities. The IMF's report also highlights that hydrocarbon growth is expected to rise as oil exports recover and production increases following the UAE's exit from OPEC. By 2027, overall growth is projected to rebound strongly, driven by increasing hydrocarbon production and recovering non-hydrocarbon activities, aided by the normalization of tourism and trade flows. Inflation is expected to rise slightly in 2026 due to higher global energy and food prices but is projected to ease in the medium term. The fiscal outlook remains positive, with the general government fiscal balance projected to remain in surplus in 2026, supported by favorable oil revenues and conservative budgeting practices. Despite anticipated narrowing of the surplus, high oil prices, dividends, and efficient expenditure measures are expected to offset revenue pressu res from weaker non-oil activities. Low general government debt provides ample fiscal space for potential responses to severe shocks, while the external position is expected to remain in surplus, recovering over the medium term as trade disruptions ease and oil exports increase. The financial sector has shown resilience, although some softening in the real estate sector has been observed. Banks remain well-capitalized with sufficient liquidity, despite tightening conditions since the conflict began. While private sector credit growth is expected to slow, real estate activity has moderated following years of strong expansion. Nonetheless, the banking sector's exposure to real estate is contained, although continued monitoring of market conditions is warranted. The IMF emphasizes the importance of maintaining agile economic policies to ensure stability and mitigate the conflict's economic impact. The report underscores the need for diversification and structural reforms to sustain growth, highlighting the rol e of trade integration and investment in technology and human capital in reinforcing non-oil growth and resilience to external shocks. The IMF team expressed appreciation to the UAE authorities and stakeholders for their collaboration and fruitful discussions during the visit.