Fitch affirms Saudi Arabia’s strong credit rating

Fitch has affirmed Saudi Arabia’s strong credit rating and said the outlook for the economy is stable, according to a statement from the agency.
The Kingdom’s credit rating stands at “A+” amid a series of economic reforms underway as part of the drive to diversify the economy to make it less dependent on oil.
“Saudi Arabia’s ratings are supported by strong fiscal and external balance sheets, including exceptionally high international reserves, low government debt and significant government assets and strong commitment to an ambitious reform agenda,” Fitch said.
Fitch said the central government deficit is expected to decline to 8.7 percent of gross domestic product (GDP) in 2017, from 17.2 percent in 2016.
Fitch also praised the strength of Saudi banks, saying: “Fitch assigns Saudi Arabia’s banking sector a Bank System Indicator of ‘a’, with only four jurisdictions receiving a higher rating. This reflects stable profitability, which has built sizeable capital buffers against any downturn in the operating environment. The sector Tier 1 regulatory capital ratio was 17.2 percent” at the end of June.
Commenting on the announcement, the Saudi Minister of Finance Mohammed Al-Jadaan said: “The statement today provides further indication that there is growing momentum and support for Vision 2030 and its delivery. This reasserts the fundamental strength of the economy and that we are building firm foundations for long-term sustainable growth and prosperity.”
“Much progress has been made and as we head toward 2018, we look forward to further progress and building toward a better future for the economy, the businesses and most importantly the people of Saudi Arabia.”

Source:Arabnews