Riyadh, February 1, 2025 — Fitch Ratings has reaffirmed Saudi Arabia’s Long-Term Foreign-Currency Issuer Default Rating (IDR) at ‘A+’ with a Stable Outlook, underscoring the Kingdom's strong economic fundamentals and resilient fiscal policies. In its latest report, Fitch highlighted the solid fiscal and external balance sheets that support this rating, noting the country's favorable government debt-to-GDP ratio and Sovereign Net Foreign Assets (SNFA) that far exceed the medians of countries with similar credit ratings, both in the 'A' and 'AA' categories.
The credit rating agency also pointed to the Kingdom's significant fiscal buffers, which include deposits and other public-sector assets, offering substantial protection against potential economic shocks. Fitch projects that Saudi Arabia's SNFA will reach an impressive 63.7% of GDP during the 2024-2025 period, a figure that stands well above the 'A' median of 8.7% of GDP. This considerable buffer, Fitch argues, enhances the Kingdom’s financial stability and provides room to absorb external shocks without undermining fiscal health.
Fitch further emphasized the positive impact of ongoing fiscal reforms in the Kingdom, aimed at making the budget more resilient to fluctuations in global oil prices. These reforms are expected to strengthen Saudi Arabia's financial position and could potentially lead to a higher rating in the future. Additionally, the agency projected continued robust growth in Saudi Arabia's non-oil exports, an important pillar of the country’s economic diversification strategy. The services balance deficit is expected to continue narrowing, with the travel account showing particularly strong growth, which further strengthens the Kingdom's external financial standing.
The positive outlook reflects Saudi Arabia's efforts to modernize its economy, diversify away from oil dependency, and build fiscal resilience through a combination of reforms, investments, and strategic growth in non-oil sectors. With strong financial reserves, fiscal discipline, and a focus on sustainable economic development, Saudi Arabia is poised to maintain its solid credit standing in the international markets, despite global economic uncertainties.