RIYADH — The credit rating agency Moody’s updated its credit report for Saudi Arabia affirming its “A1” rating for the Kingdom of Saudi Arabia with a stable outlook.

The rating affirmation is based on Moody’s assessment of the government’s improving track record of fiscal policy effectiveness, evidenced by policy responses to both periods of low and high oil prices, which demonstrate a commitment to fiscal consolidation and longer-term fiscal sustainability.

In its report, the agency expected the continuation of positive growth in real GDP by 5.0% on average in the period 2021-2023, supported by further post pandemic recovery, progress on economic diversification, capital and development projects, and a further unwinding of oil production cuts.

Despite the rise in oil prices, the agency also expected the continuity of the government's commitment to further fiscal consolidation in the medium term and the spending control improvements that demonstrate an increasingly more effective fiscal policy framework in Saudi Arabia.

Moody’s assessment of Saudi Arabia's financial institutions highlights the positive impact of the structural measures and reforms taken by the Kingdom during the past five years, in addition to the government’s tangible progress in improving its domestic business environment, that illustrate the fiscal policy effectiveness and increased government efficiency. — SPA