Fitch Praises the Preliminary Statement of the Kingdom’s 2022 General Budget

The international credit rating agency “Fitch” praises the preliminary statement of the Kingdom’s general budget for the Year 2022.

The agency praised the preliminary statement of the general budget of the Kingdom of Saudi Arabia in a statement published on Tuesday 5th of Oct 2021.

The agency highlighted that the Kingdom maintains large financial reserves, which support the Kingdom of Saudi Arabia’s rating and provides greater flexibility to facilitate public financing needs in the context of unstable oil revenues.

Where the preliminary statement of the Kingdom’s general budget for the Year 2022 indicated that the Kingdom is targeting a financial reserve in the Saudi Central Bank (SAMA) of SR350 billion in 2022 (approximately 11% of GDP according to Fitch estimates), and it is expected to rise in the medium term.  Previously, the stability was at a minimum level of SR265 billion in 2022-2023.

Furthermore, the preliminary statement of the Kingdom’s general budget for the Year 2022 predicted a stability in the nominal value of the public debt as of 2022, and its decrease as a percentage of GDP to 29.2% in 2023 and 27.6% in 2024.

The agency commented that this is less than its expectation on its credit rating report for the Kingdom issued in July 2021, when it affirmed its credit rating for the Kingdom of Saudi Arabia at (A) and revised the Outlook from Negative to Stable..

Fitch’s comment confirms the positive future directions of the financial policies that the Kingdom seeks to pursue as an extension of the structural measures and reforms taken by the Kingdom during the past five years in accordance with the objectives of the Kingdom’s Vision 2030.

This was positively reflected on the great global confidence in the strength of the Saudi economy and supported the positive outlook for the future of the financial sustainability of the Kingdom.