Moody's credit ratings agency adjusted its outlook for Saudi rating from “stable” to “negative”. Saudi Finance Minister Mohammed Al-Jadaan revealed that "painful" measures were taken to counter the effects of the new Corona virus outbreak.
In the first change of the credit rating outlook for Saudi Arabia in four years, Moody's adjusted its future outlook for the kingdom’s rating from “stable” to “negative”, but maintained its rating at “any one” (A1), which is the fifth highest credit score.
The agency added in a statement - Al-Jazeera received a copy of it - that the collapse of oil prices due to the Corona pandemic had increased financial risks to Saudi Arabia, and would erode its sovereign financial reserves.
She said that the severe shock caused by the decline in oil prices will lead to an increase in Saudi debt to about 45% of GDP in the medium term.
Moody's stated that the expectations indicate a decrease in government revenues for the Kingdom by about 33% during the current year, and by about 25% during the next year, compared to its level in the past year.
For his part, Saudi Finance Minister Mohammed Al-Jadaan said that the Kingdom should cut budget spending sharply to counter the impact of the Corona virus.
Al-Jadaan announced that the Saudi authorities will take measures "very strict and may be painful," adding that the withdrawal from the kingdom's monetary reserves during the current year should not exceed 120 billion riyals (about 32 billion dollars).