Saudi Arabia could successfully reduce fiscal reliance on hydrocarbons over time: Moody’s  

Saudi Arabia could successfully reduce fiscal reliance on hydrocarbons over time: Moody’s  

RIYADH: Saudi Arabia’s recent financial performance and the wide range of economic diversification programs could help the country reduce its fiscal reliance on hydrocarbons over time, credit rating agency Moody’s Investors Services said in its latest note.

Affirming a positive economic outlook, Moody’s noted that the Kingdom’s credit strengths include its robust government balance sheet, underpinned by moderate debt levels and large fiscal reserve buffers.

On March 17, Moody’s changed the outlook on the Saudi government to positive from stable and affirmed its long-term issuer and senior unsecured ratings at A1. The rating agency kept Saudi Arabia’s local currency and foreign currency country ceilings unchanged at Aa2.

“Saudi Arabia’s positive outlook reflects the increasing likelihood that broad-based structural reforms and investments in a wide range of diversification projects will help reduce significantly the sovereign’s economic and fiscal reliance on hydrocarbons over time,” said Christian Fang, vice president-senior analyst at Moody’s.

Diversifying its economy is one of the main agendas of Vision 2030, and the Kingdom is now placing itself as a global tourism hub, along with catalyzing its efforts to strengthen other sectors like logistics, technology, and mining.

Moody’s further noted that policy effectiveness and the Kingdom’s large stock of proved hydrocarbon reserves with low