Moody's raises Saudi Arabia's outlook to ‘stable’ from ‘negative’, affirms A1 rating

Arab World Materials 6 November 2021 06:29 (UTC +04:00)

Ratings agency Moody's on Friday changed Saudi Arabia's outlook to “stable” from “negative”, saying it was likely the government would reverse most of its 2020 debt increase while preserving fiscal buffers.

The ratings agency affirmed the country's rating at ‘A1’.

The Moody's report also highlighted Saudi's moderate debt burden that was lower than most similarly rated sovereigns, as well as economic strength underpinned by the country's highly competitive position in the oil market.

The largest Arab economy recorded a budget surplus of 6.7 billion riyals ($1.79 billion) in the third quarter this year, as higher oil prices fueled its first quarterly surplus since 2019.

Finance Minister Mohammed al-Jadaan told Reuters recently that Saudi Arabia's economy was recovering well from the pandemic which had sent it into a deep recession last year.

To replenish state coffers, the kingdom tripled a value-added tax and removed a cost-of-living allowance last year, among other measures.