Saudi Arabia’s long-term foreign-currency issuer default rating (IDR) has been affirmed at “A+” with a stable outlook by global credit rating agency Fitch Ratings. It is a high rating reflecting the Kingdom’s solid financial standing, highly resilient economy and significant financial buffers.
Saudi Arabia’s credit profile is very strong, thanks to the government debt and the net foreign assets of the Saudi sovereign, the latest report said. These important financial indicators are still well above the median values for other countries in the ‘A’ and ‘AA’ rating grades.
The Kingdom has been prudent in its financial policies since the strategic planning of the Ministry of Finance and this is now bearing fruit. The country has been showing great economic resilience in the face of continuing regional geopolitical events and this strength has been largely in the areas of non-oil economic activities.
Key Drivers Behind the Steady Economic Outlook
Fitch said its insurance of the country’s banking sector has not been compromised. It boasts high capital ratios and low non-performing loans and the bank has not needed any emergency funding from the Saudi Central Bank in recent tensions in the region. Moreover, the agency estimates that the country’s foreign currency reserves will be equivalent to about 11.6 months of external payments in 2026, which is significantly higher than the average for the similarly rated counterparts.
The growth of real GDP is projected to slow slightly to 0.6% in 2026, but rebound in 2027. The return of maritime trade to the Strait of Hormuz will be the basis for the country’s recovery and the return of oil and petrochemical production will follow.
This relatively stable outlook is also being driven by growth in the domestic market. The Public Investment Fund (PIF) has been making strategic investments and a number of national giga-projects are being rolled out in a staged manner, effectively contributing to long-term economic growth.
Overall, this has left a strong domestic business confidence and consumer spending to keep the market active. The country’s increasingly diversified and modern economy is successfully being developed with the support of modern governance and robust institutions, supporting the Saudi Arabia Vision 2030 agenda.The country’s modern government and institutions are successfully supporting the Saudi Vision 2030 agenda by fostering an increasingly diversified and modern economy.
