Moody's Investors Services maintained Saudi Arabia's credit rating at A1, with a negative outlook, citing external shocks due to COVID-19 pandemic.
According to a Ministry of Finance statement, the agency stressed that the structural reforms in the Kingdom led to narrowing the fiscal deficit in Q1, adding that the non-oil sector continues to recover, backed by the strong growth of infrastructure of real estate products.
The agency also said that plans to diversify the economy in the Kingdom will contribute to raising growth in the medium to long term, in addition to the structural and organizational reforms that supported improvement in the competitive ability.
Moody's expects Saudi real GDP growth to reach 1.6% and 5% in 2021 and 2022, respectively.
Moreover, the agency lowered its forecast for fiscal deficit from 6.2% to 4.7% of GDP in 2021. The current account surplus was projected to hit nearly 3.4% of GDP, compared to the previous forecast of 2.9% in its latest report.
Debt is projected to reach 30.6% and 30.9% of GDP in 2021 and 2022, respectively, Moody’s added.