Rating Agencies Raise Saudi Economy Rating with Positive Outlook

Rating Agencies Raise Saudi Economy Rating with Positive Outlook

Rating agencies have upgraded the Saudi economy to a “positive” and stable outlook.

They affirmed that the structural reforms have been reflected in the tangible progress in economic development and the support of diversification policies, especially in the non-oil sector.

S&P Global Ratings upgraded its credit report for Saudi Arabia, raising its long and short-term foreign and local currency sovereign credit ratings to 'A/A-1' with a stable outlook, according to its recent report.

The agency indicated in its report that this rating upgrade is a result of the Kingdom's significant reforms efforts in recent years and its realization of structural improvements that contributed to supporting a sustained development of the non-oil sector, in addition to improving public finance management and maintaining a balanced public debt level.

The agency highlighted the strong real GDP growth of 8.7 percent in 2022, the highest among the G-20 economies. It expects moderate economic growth, averaging 2.6 percent in 2023-2026 with GDP/capita averaging $31,500 (significantly above pre-pandemic levels).

The agency forecasts the non-oil sector to remain strong through 2026 due to service sector growth supported by significant ongoing social reforms and female workforce participation.

It also expected the continuity of fiscal surpluses through 2024 (after reaching 2.5 percent of GDP in