“Moody’s Ratings” upgrades its credit rating of the Kingdom of Saudi Arabia to “Aa3” with “stable” Outlook
The credit rating agency ”Moody’s Ratings” has upgraded the Kingdom of Saudi Arabia’s credit rating at “Aa3” in local and foreign currency with a “stable” outlook.
The agency indicated in its report that this rating upgrade with stable outlook is a result of the Kingdom's ongoing progress in economic diversification and the robust growth of its non-oil sector. Over time, these advancements are expected to reduce Saudi Arabia’s exposure to oil market developments and long-term carbon transition on its economy and public finances.
The agency also commended the Kingdom's financial planning within the fiscal space, emphasizing its commitment to prioritizing expenditure and enhancing the spending efficiency. Additionally, the government’s ongoing efforts to utilize the available fiscal resources to diversify the economic base through transformative spending, were highlighted as instrumental in supporting the sustainable development of the Kingdom's non-oil economy and maintaining a strong fiscal position. In its report, the agency noted that this planning and commitment underpin its projection of a relatively stable fiscal deficit, which could range between 2%-3% of the Gross Domestic Product (GDP).
Moody's has expected that the non-oil private sector GDP of Saudi Arabia will expand by 4-5% in the coming years, positioning it among the highest in the Gulf Cooperation Council (GCC) region, an indication of continued progress in the diversification efforts reducing the kingdom’s exposure to oil market developments.
It is worth noting that during the current and previous years, the Kingdom has achieved multiple credit rating upgrades from global rating agencies. These advancements reflect the Kingdom's ongoing efforts toward economic transformation, supported by structural reforms and the adoption of fiscal policies that promote financial sustainability, enhance financial planning efficiency, and reinforce the Kingdom's strong and resilient fiscal position.
