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Fitch reduces Saudi Arabia's sovereign rating

Fitch Ratings reduced the sovereign credit rating of Saudi Arabia - from AA- to A +  with a negative outlook.

The decision is due to the continuing deterioration of the external and internal balance sheet, as well as the larger than expected budget deficit in 2016, and doubts about the extent to which the government will be able to advance in the ambitious reform program.

The agency notes that from June 2016 to January 2017 government deposits decreased by 242 billion reais ($64.5 billion) to 841 billion reais ($224 billion), or 35% of the country's GDP.

Relatively low oil prices do not allow Saudi Arabia to substantially rectify the situation with the budget deficit, which in 2016 amounted to 416 billion reais ($ 110 billion), or 17.3% of GDP.

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