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  • Ahmed Saleh

Fitch Ratings maintains Saudi Arabia's 'A+' IDR with Stable Outlook

Riyadh, February 05, 2024, Fitch Ratings has upheld Saudi Arabia's Long-Term Foreign-Currency Issuer Default Rating (IDR) at 'A+' with a Stable Outlook. In its latest report, the agency underscored the Kingdom's robust fiscal and external balance sheets, with government debt/GDP and sovereign net foreign assets (SNFA) significantly outperforming both the 'A' and 'AA' medians. Additionally, Fitch noted the presence of substantial fiscal buffers in the form of deposits and other public sector assets.

Of particular note is Fitch's assumption that the Sovereign Net Foreign Assets (SNFA) will remain above 50% of GDP in 2024-2025, a figure markedly higher than the 'A' median (6% of GDP) and 'AA' median (34% of GDP). Furthermore, the agency highlighted the potential positive impact on the rating stemming from fiscal reforms aimed at bolstering the budget's resilience to oil price fluctuations.

Looking ahead, Fitch forecasted a real growth rate of 4.5% in the non-oil sector for 2024-2025, following an average growth of around 5% witnessed in 2022-2023. This projection reflects optimism regarding the diversification efforts and economic reforms being pursued within the Kingdom.

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