Moody's downgraded its Saudi outlook from stable to negative, saying that a collapse in oil prices had increased the financial risks to the kingdom.
The agency said in a statement issued on Friday that the severe shock caused by the decline in oil prices would lead to an increase in Saudi debts and the erosion of sovereign financial reserves.
She stated that the projections indicate a decline in government revenues for the Kingdom by about 33% in 2020, and about 25% in 2021 compared to 2019, and showed that the sharp slowdown in GDP growth also reduces non-oil sector revenues.
Moody's said it expects in the medium term to increase the proportion of Saudi government debt to about 45% of GDP. She stated that spending on the health sector will increase as part of efforts to contain the Corona epidemic.
The statement pointed out that the general budget of Saudi Arabia has weakened since the last shock in oil prices in 2015 and 2016.
However, the agency nevertheless maintained its credit rating for Saudi Arabia at "A1", saying that the kingdom's general budget is still relatively strong despite this decline.
She said the government was likely to offset some revenue losses for the current and next two years through spending cuts.