Standard and Poor’s Global Ratings affirmed its “A/A-1” long- and short-term foreign and local currency unsolicited sovereign credit ratings on Saudi Arabia with a stable outlook.
“The stable outlook reflects that we expect the government's wide-ranging reforms will continue to underpin the development of the non-oil sector and support non-oil growth and fiscal receipts,” said S&P on Friday.
“This is balanced against the cyclicality of a still hydrocarbon-focused economy, and fiscal pressures tied to the country's transformation plan and expanding population.”
“Saudi Arabia has embarked on a significant, rapid economic and social transformation program under the Vision 2030. In the leadup to 2030, we expect to see an acceleration of investment projects that seek to establish new industries, such as tourism, and diversify the economy away from its primary reliance on the upstream hydrocarbon sector,” it added.
“Over the long term, we anticipate that Vision 2030 projects will bear fruit by creating a more diversified economy and revenue base, jobs for a young population, and broader workforce participation,” it stressed.
Moreover, it noted: “Large hydrocarbon reserves and low cost of production provide Saudi Arabia some resilience to a global energy transition to low-carbon alternatives, especially in a future scenario where fossil fuel demand will largely be met by a smaller number of the most efficient producers.”
