Riyad September 17 2022: International credit rating agency, Standard & Poors (S&P), updated its outlook for Saudi Arabia to positive as the country’s recovery from the pandemic is accelerating.
In a statement, issued yesterday, it assessed the Kingdom’s short and long term foreign and local currency sovereign credit ratings to A-/A-2.
The agency said the positive future outlook reflects the strength of gross domestic product (GDP) growth, the country’s financial policies at the backdrop of its success in recovering from the repercussions of the pandemic, the sustainability of government reform programs drive in addition to the increasing growth of the non-oil economy which has made great strides in supporting the Kingdom’s financial and foreign indices.
S&P expects the Kingdom’s GDP to grow to its highs in ten years to a ceiling of 7.5 percent in 2022 with an expected financial surplus in the state budget of about 6.3 percent.
S&P also forecasts a growth of the Saudi economy product capacity and a drive of the growth in the long run due to efforts of developing the general finances and mega economic reforms.
Dealing with flexibility and performance, the agency expects support of the financial credits in 2022 – 2025 due to governmental efforts in developing the public finances and commitment of improving the spending and efficiency of expenditure despite oil high prices.
The agency also forecasts no dramatic rise of sovereign debts costs on the Kingdom as most of the public debt portfolio is running at a fixed rate.
The agency described the inflation rates in the Kingdom as relatively low in comparison to its counterparts and that those rates would be under control in view of the government subsidizing of fuel and food prices in addition to tying the local currently with the relatively-strong US dollar.
