“Standard & Poor’s” confirms Saudi Arabia’s rating at A- / A-2,...

Standard & Poor’s Global credit rating agency affirmed its credit rating of Saudi Arabia at A- / A-2 with a stable outlook. It said in a statement that the Kingdom’s strong net asset position remains a major support for its rating. The agency lowered its forecast for the economic contraction this year from 5% to 4.5%. It also lowered its forecast for the percentage of the budget deficit during this year from 12.6% to 11% of GDP. The Minister of Finance, Muhammad Al-Jadaan, confirmed the strength of the Kingdom’s economy and its ability to deal with and overcome the Corona virus crisis, despite the urgent need to reduce expenditures. He said he was able to absorb declining revenues and budget deficits. According to the figures, the credit rating agency Standard and Poor’s S&P approved yesterday the expectations of Finance Minister Muhammad Al-Jadaan that the July data heralds an economic recovery, and that the pace of the economy’s contraction is less than the 6.8% that the International Monetary Fund had predicted earlier, and these positive estimates of the rating agencies confirm Global confidence in the economy, the strength of the financial position and its ability to face challenges, especially in light of the crises and exceptional circumstances that the world is currently witnessing.The agency said that the Kingdom’s strong net assets position on both its financial and external assets remains a major support for the rating, stating that the government’s financial reserves and confidence in the economy helped the strong demand for debt issues in domestic and international markets. S&P indicated that Saudi Arabia is the only country in the region. The world, which maintains a large capacity to export surplus oil, in addition to its leading role in OPEC and the global oil market, expects that the application of value added after its recent increase to 15% in mid-2020 will support government financial revenues. A credit rating or creditworthiness is a degree that shows the judgment of international credit rating agencies over the ability of a country or an institution to pay its debts.