S&P Global Upgrades Credit Rating of Saudi Arabia to A+ with Stable Outlook

The Saudi flag. Asharq Al-Awsat
The Saudi flag. Asharq Al-Awsat
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S&P Global Upgrades Credit Rating of Saudi Arabia to A+ with Stable Outlook

The Saudi flag. Asharq Al-Awsat
The Saudi flag. Asharq Al-Awsat

Credit rating agency S&P Global upgraded Saudi Arabia’s local and foreign currency credit rating to A+ with a stable outlook.

In its report, the agency stated that the upgrade with a stable outlook reflects the Kingdom's continued progress in economic diversification, sustained growth of the non-oil sector, and development of the local capital market.

These factors help offset the risks associated with rising external sovereign debt, which is being strategically invested to achieve the objectives of Saudi Vision 2030 while managing debt servicing costs.

The agency highlights the Kingdom's measures to spur investments that will support non-oil growth prospects and economic resiliency over the medium term.

As a result, S&P forecasts real gross domestic product (GDP) growth to average 4% over 2025-2028.

The agency expects the Kingdom’s fiscal deficit to average 4.2% of GDP during the same period, driven by transformational spending aimed at accelerating economic diversification.

Furthermore, it is expected that the Kingdom will maintain its comfortable net asset position. Saudi Arabia has seen multiple credit rating upgrades from global rating agencies over the past few years.

These advancements reflect the Kingdom's improved institutional strength and ongoing implementation of structural reforms. They are enabling a successful economic transformation and unprecedented economic diversification in the context of fiscal sustainability and enhanced financial planning efficiency that will continue to support its strong and resilient fiscal position.



Riyadh Real Estate Awaits Impact of Measures to Curb Price Surge

Residential and commercial properties in the Saudi capital Riyadh (Reuters)
Residential and commercial properties in the Saudi capital Riyadh (Reuters)
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Riyadh Real Estate Awaits Impact of Measures to Curb Price Surge

Residential and commercial properties in the Saudi capital Riyadh (Reuters)
Residential and commercial properties in the Saudi capital Riyadh (Reuters)

The Saudi real estate market is currently in a state of cautious anticipation, driven by unprecedented decisions and measures announced by Crown Prince Mohammed bin Salman.

These steps aim to increase the supply of properties and restore balance in the market to address the rising costs of land and rental prices.

Data from the market shows a stagnation in property purchases by citizens, as they await the impact of these measures, hoping they will bring stability to property prices in Riyadh and lower costs.

In March, the Crown Prince directed the implementation of a series of regulatory measures, including lifting restrictions on the development of over 81 square kilometers of land north of Riyadh.

This move is expected to deliver tens of thousands of affordable residential plots annually to citizens, following a significant rise in property prices in Riyadh.

According to Saudi Minister of Municipal and Rural Affairs and Housing Majid Al-Hogail, these measures will add between 10,000 and 40,000 plots of land annually in the northern region of Riyadh, ensuring a better balance between supply and demand in the market.

The Crown Prince has already donated 1 billion riyals to the National Developmental Housing Foundation (Sakan), represented by Jood Eskan, to support home ownership for eligible families across Saudi Arabia.

The housing projects funded by this donation are to be completed within 12 months and executed by national companies.

The Crown Prince also ordered monthly progress reports to ensure that all residential units are delivered within one year.

Real estate market experts told Asharq Al-Awsat that current market data reveals a stagnation in property purchases by citizens, as they await the impact of recent policy changes and their potential to restore balance to the market.

Many real estate companies and agencies have observed a decline in sales activity, with property marketers facing difficulties in encouraging buyers who prefer to delay decisions until the effects of Crown Prince Mohammed bin Salman’s directives take shape.

Real estate expert and marketer Abdullah Al-Mousa told Asharq Al-Awsat that the current stagnation in property prices in Riyadh is a direct result of the Crown Prince’s initiatives to increase property supply, which aim to restore price equilibrium following the recent surge in real estate costs.

He views the decline as a positive step toward balancing supply and demand, contributing to a more sustainable and fair market for all stakeholders.

Al-Mousa anticipates that this stagnation will persist until all government directives are fully implemented in the coming months.

He noted that, with plans to increase the property supply, the market could experience gradual recovery in the long term, especially given Riyadh’s continued population and economic growth.

The expert highlighted that several factors may sustain the current stagnation, including high interest rates, which reduce citizens’ purchasing power, the oversupply of properties relative to demand, and global economic fluctuations that could affect investments.

However, he emphasized that Riyadh’s ongoing population growth, improving national economy, rising per capita income, large-scale infrastructure projects like the Riyadh Metro, and continued government support for housing programs are expected to drive the recovery of the real estate market.

Al-Mousa also predicted further improvement in the sector as policies are implemented and market conditions are monitored.