Fitch Ratings recently affirmed Saudi Arabia’s long-term foreign currency issuer default rating at A+ with a stable outlook, reflecting growing international confidence in the Kingdom’s fiscal and economic policies. This announcement further solidifies the Saudi economy’s position as one of the most stable and attractive in the region, underpinned by strong financial fundamentals and substantial reserves.
Financial strength and superiority over peers
The agency explained in its report that the Kingdom's credit rating directly reflects the strength of its financial position. The Kingdom's debt-to-GDP ratio and net sovereign foreign assets are significantly stronger than the averages of countries with "A" and "AA" ratings. Fitch noted that the Kingdom possesses substantial financial buffers and considerable reserves distributed across deposits and diversified public sector assets, which enhances its ability to absorb global economic shocks and fluctuations in energy markets.
Economic growth prospects and Vision 2030
Looking ahead, the agency anticipates positive momentum for the Saudi economy, projecting GDP growth to reach 4.8% in 2026. Simultaneously, the fiscal deficit is expected to gradually decrease to 3.6% of GDP by the end of 2027. This positive outlook is primarily attributed to the success of the Kingdom's diversification strategies, with non-oil revenues continuing to benefit significantly from robust economic activity and improved revenue collection efficiency – a key pillar of Vision 2030.
Structural reforms and attracting investment
Fitch's report also commended the momentum of structural reforms underway in the Kingdom, which recently included the updated investment law, as well as bold steps to further open the real estate and stock markets to foreign investors. These reforms not only improve the business environment but also boost foreign direct investment inflows, creating new job opportunities and supporting sustainable development.
The strategic importance of classification
This rating is of paramount importance both domestically and internationally. Domestically, it underscores the success of fiscal policies in controlling spending and diversifying income. Internationally, maintaining the "A+" rating sends a reassuring message to investors and global financial institutions about the stability of the Saudi economy, facilitating access to low-cost borrowing when needed and reinforcing the Kingdom's position as a leading investment destination in the Middle East and North Africa.
