0 evaluări0% au considerat acest document util (0 voturi)
77 vizualizări7 pagini
Standard and poor's affirmed its longand short-term foreign and local currency sovereign credit ratings on the Kingdom of Saudi Arabia at 'AA/ A-1+' the positive outlook indicates that we could upgrade Saudi Arabia in the next year if we believe that the government has built on its achievements in private-sector development. By managing high oil revenues prudently, the general government has retired virtually all of its debt, generating additional fiscal space for countercyclical policies.
Standard and poor's affirmed its longand short-term foreign and local currency sovereign credit ratings on the Kingdom of Saudi Arabia at 'AA/ A-1+' the positive outlook indicates that we could upgrade Saudi Arabia in the next year if we believe that the government has built on its achievements in private-sector development. By managing high oil revenues prudently, the general government has retired virtually all of its debt, generating additional fiscal space for countercyclical policies.
Standard and poor's affirmed its longand short-term foreign and local currency sovereign credit ratings on the Kingdom of Saudi Arabia at 'AA/ A-1+' the positive outlook indicates that we could upgrade Saudi Arabia in the next year if we believe that the government has built on its achievements in private-sector development. By managing high oil revenues prudently, the general government has retired virtually all of its debt, generating additional fiscal space for countercyclical policies.
'AA-/A-1+'; Outlook Remains Positive Primary Credit Analyst: Trevor Cullinan, Dubai (971) 4372-7113; trevor.cullinan@standardandpoors.com Secondary Contact: Christian Esters, CFA, Frankfurt (49) 69-33-999-242; christian.esters@standardandpoors.com Analytical Group Contact: SovereignEurope; SovereignEurope@standardandpoors.com Table Of Contents Overview Rating Action Rationale Outlook Key Statistics Related Criteria And Research Ratings List WWW.STANDARDANDPOORS.COM/RATINGSDIRECT JUNE 6, 2014 1 1329931 | 301112013 Research Update: Ratings On Saudi Arabia Affirmed At 'AA-/A-1+'; Outlook Remains Positive Overview In our view, Saudi Arabia's government and external balance sheets remain strong and provide an ample buffer to withstand external shocks, including a drop in oil prices. We are therefore affirming our 'AA-/A-1+' sovereign credit ratings on the Kingdom of Saudi Arabia. The positive outlook indicates that we could upgrade Saudi Arabia in the next year if we believe that the government has built on its achievements in private-sector development. Rating Action On June 6, 2014, Standard & Poor's Ratings Services affirmed its long- and short-term foreign and local currency sovereign credit ratings on the Kingdom of Saudi Arabia at 'AA-/A-1+'. The outlook remains positive. Rationale The ratings are supported by the very strong external and fiscal positions Saudi Arabia has built up over several years. By managing high oil revenues prudently, the general government has retired virtually all of its debt, generating additional fiscal space for countercyclical policies. We estimate the general government's net asset position at close to 110% of GDP on average during 2014-2017. Notwithstanding our assumption that the oil price will decline to about $95 per barrel by 2017, we expect that Saudi Arabia's current account surpluses will average a still-high 12% of GDP and external debt net of liquid external assets will remain strong averaging about 200% of current account receipts over the same period. We estimate GDP per capita at $26,000 in 2014. Trend growth in real per capita GDP, which we measure using 10-year weighted-average growth, amounted to 2% during 2008-2017, which is in line with peers that have similar GDP per capita. We note that government reforms are resulting in some improvements to the highly segmented labor market. Latest data indicate that Saudi nationals' share of total employment increased to 24% in 2013 from 22% in 2012. We estimate that 70% of the increase took place in the private sector, which now accounts for around 56% of the employment of Saudi nationals. Meanwhile, women's share of total employment increased to 9.4% in 2013 from 7.7% in the WWW.STANDARDANDPOORS.COM/RATINGSDIRECT JUNE 6, 2014 2 1329931 | 301112013 previous year. However, the unemployment rate remained high at 11.7% for Saudi nationals and 0.2% for non-Saudis (overall 5.6%). In our view, it remains to be seen whether the private sector can generate jobs sufficiently attractive to Saudi nationals to absorb the significant inflow into the labor market expected in the coming years. Saudi demographic data show that about 40% of the population is younger than 20. Moreover, with the employment of Saudi nationals mostly requiring higher labor costs than the expat population, unit labor costs could rise and in turn weaken overall economic competitiveness. We view Saudi Arabia's economy as undiversified and vulnerable to a sharp and sustained decline in the oil price. About 85% of exports and 90% of government revenues stem directly from the hydrocarbons sector. The IMF calculated Saudi's fiscal breakeven oil price--the oil price necessary to balance the government's budget--at $84 in 2013. The hydrocarbon sector accounts for slightly less than half of GDP. However, we find that the non-hydrocarbon sector relies to a significant extent on government spending (funded by hydrocarbon revenues) and downstream hydrocarbon activities. We see Saudi Arabia's significant gas and oil revenues as supportive of the current ratings. Sustained high oil prices over the past few years have helped bolster financial buffers, maintaining government liquid assets at above 100% of GDP and significantly offsetting the concentration risk related to the economy's hydrocarbon dependency. According to our estimates, based on the 2013 BP Statistical Review of World Energy, Saudi Arabia's annual production of both oil and gas--about 5 billion barrels of oil equivalent--could be maintained for the coming 66 years, given 320 billion barrels of oil equivalent in estimated reserves. However, in terms of years of hydrocarbon production at current levels, Saudi Arabia is surpassed by Qatar (114), Kuwait (92), and the United Arab Emirates (89). As a result--alongside the high share of hydrocarbons in nominal GDP, exports, and a relatively high fiscal breakeven oil price--we view diversification away from the oil sector as a more pressing issue in Saudi Arabia relative to some other GCC countries. Saudi Arabia is an absolute monarchy in which decision-making is highly centralized in the hands of the king and the ruling family. We find that this makes policymaking more difficult to predict. Political institutions are still at an early stage of development compared with those of nonregional peers in the 'AA' ratings category and we detect little scope for direct political participation. Establishing the Allegiance Council in 2007--to formalize the procedure of appointing a crown prince once a new king ascends to the throne--may help institutionalize the succession process in Saudi Arabia. However, we believe that this new framework will face a crucial test when the scepter is passed from a son of King Abdulaziz Al-Saud, who established the kingdom in 1932, to the next generation of rulers. So far only the sons of King Abdulaziz have ruled. We continue to view succession as an element of uncertainty over the medium term. WWW.STANDARDANDPOORS.COM/RATINGSDIRECT JUNE 6, 2014 3 1329931 | 301112013 Research Update: Ratings On Saudi Arabia Affirmed At 'AA-/A-1+'; Outlook Remains Positive Given the Saudi riyal's peg to the U.S. dollar, we view monetary policy flexibility as limited. The long-standing currency peg anchors expectations but binds Saudi Arabia's monetary policy to that of the U.S. Federal Reserve. Furthermore, the authorities' ability to transmit their monetary policy is affected by the underdevelopment of the domestic bond market. Outlook The positive outlook reflects our view that there is at least a one-in-three chance that we could raise our ratings on Saudi Arabia in the next year. A decisive factor will be our assessment of the government's ability to keep building on economic diversification efforts and strengthen its private-sector labor market for its citizens. We expect some of these measures would be reflected in increased economic competitiveness and rising income levels beyond our current expectations. We could revise the outlook to stable if we anticipated that weaker economic growth or sustained lower oil prices could lead to GDP per capita that was not commensurate with an improved assessment of economic risk. The ratings could also come under pressure if domestic or regional events compromised political and economic stability. Key Statistics Table 1 Kingdom of Saudi Arabia - Selected Indicators 2007 2008 2009 2010 2011 2012 2013e 2014f 2015f 2016f 2017f Nominal GDP (US$ bil) 416 520 429 527 670 734 745 793 810 825 841 GDP per capita (US$) 16,678 20,157 16,095 19,113 23,594 25,139 24,847 25,747 25,611 25,488 25,394 Real GDP growth (%) 6.0 8.4 1.8 7.4 8.6 5.8 4.0 4.2 4.2 4.2 4.3 Real GDP per capita growth (%) 2.5 4.9 (1.5) 3.9 5.5 2.8 1.2 1.4 1.6 1.7 1.9 Change in general government debt/GDP (%) (0.4) (0.8) (0.5) (1.7) (0.4) (0.2) (0.4) (0.1) 0.0 0.0 (0.5) General government balance/GDP (%) 13.4 31.0 (4.2) 5.2 12.1 14.2 7.1 4.5 1.2 (0.1) (0.5) General government debt/GDP (%) 6.7 4.5 4.9 2.3 1.4 1.0 0.6 0.5 0.5 0.5 0.0 Net general government debt/GDP (%) (101.2) (108.5) (117.7) (106.6) (99.2) (108.9) (114.5) (112.2) (110.5) (107.6) (105.0) General government interest expenditure/revenues (%) 3.0 1.5 2.5 1.4 0.7 0.5 0.4 0.2 0.2 0.2 0.2 Oth dc claims on resident non-govt. sector/GDP (%) 39.5 39.3 47.4 40.9 35.5 37.7 41.8 44.0 48.2 53.0 58.2 CPI growth (%) 5.0 6.1 4.1 3.8 3.7 2.9 3.5 3.0 3.2 3.4 3.4 Gross external financing needs/CARs +use. res (%) 60.9 58.8 79.9 66.9 54.3 53.8 58.7 61.3 76.1 79.7 83.3 WWW.STANDARDANDPOORS.COM/RATINGSDIRECT JUNE 6, 2014 4 1329931 | 301112013 Research Update: Ratings On Saudi Arabia Affirmed At 'AA-/A-1+'; Outlook Remains Positive Table 1 Kingdom of Saudi Arabia - Selected Indicators (cont.) Current account balance/GDP (%) 22.4 25.5 4.9 12.7 23.7 22.4 17.8 16.6 12.5 9.7 7.1 Current account balance/CARs (%) 35.3 38.4 9.4 23.8 40.0 38.9 32.1 30.7 23.7 19.1 14.5 Narrow net external debt/CARs (%) (148.7) (157.5) (238.0) (205.9) (177.2) (195.7) (207.5) (192.8) (197.1) (199.9) (202.2) Net external liabilities/CARs (%) (153.7) (146.4) (215.6) (190.6) (162.6) (181.8) (192.3) (176.0) (178.0) (177.5) (176.0) Other depository corporations (dc) are financial corporations (other than the central bank) whose liabilities are included in the national definition of broad money. Gross external financing needs are defined as current account payments plus short-term external debt at the end of the prior year plus nonresident deposits at the end of the prior year plus long-term external debt maturing within the year. Narrow net external debt is defined as the stock of foreign and local currency public- and private- sector borrowings from nonresidents minus official reserves minus public-sector liquid assets held by nonresidents minus financial sector loans to, deposits with, or investments in nonresident entities. A negative number indicates net external lending. CARs--Current account receipts. The data and ratios above result from S&Ps own calculations, drawing on national as well as international sources, reflecting S&Ps independent view on the timeliness, coverage, accuracy, credibility, and usability of available information. Related Criteria And Research Related Criteria Sovereign Government Rating Methodology And Assumptions, June 24, 2013 Methodology For Linking Short-Term And Long-Term Ratings For Corporate, Insurance, And Sovereign Issuers, May 7, 2013 Criteria For Determining Transfer And Convertibility Assessments, May 18, 2009 Related Research Standard & Poor's Revises Its Crude Oil And Natural Gas Price Assumptions, June 3, 2014 Default Study: Sovereign Defaults And Rating Transition Data, 2013 Update, April 18, 2014 Outlooks: The Sovereign Credit Weathervane, Year-End 2013 Update, Feb. 4, 2014 In accordance with our relevant policies and procedures, the Rating Committee was composed of analysts that are qualified to vote in the committee, with sufficient experience to convey the appropriate level of knowledge and understanding of the methodology applicable (see 'Related Criteria And Research'). At the onset of the committee, the chair confirmed that the information provided to the Rating Committee by the primary analyst had been distributed in a timely manner and was sufficient for Committee members to make an informed decision. After the primary analyst gave opening remarks and explained the recommendation, the Committee discussed key rating factors and critical issues in accordance with the relevant criteria. Qualitative and quantitative risk factors were considered and discussed, looking at track-record and forecasts. The chair ensured every voting member was given the opportunity to articulate WWW.STANDARDANDPOORS.COM/RATINGSDIRECT JUNE 6, 2014 5 1329931 | 301112013 Research Update: Ratings On Saudi Arabia Affirmed At 'AA-/A-1+'; Outlook Remains Positive his/her opinion. The chair or designee reviewed the draft report to ensure consistency with the Committee decision. The views and the decision of the rating committee are summarized in the above rationale and outlook. Ratings List Ratings Affirmed Saudi Arabia (Kingdom of) Sovereign Credit Rating AA-/Positive/A-1+ Transfer & Convertibility Assessment AA Complete ratings information is available to subscribers of RatingsDirect at www.globalcreditportal.com and at spcapitaliq.com. All ratings affected by this rating action can be found on Standard & Poor's public Web site at www.standardandpoors.com. Use the Ratings search box located in the left column. Alternatively, call one of the following Standard & Poor's numbers: Client Support Europe (44) 20-7176-7176; London Press Office (44) 20-7176-3605; Paris (33) 1-4420-6708; Frankfurt (49) 69-33-999-225; Stockholm (46) 8-440-5914; or Moscow 7 (495) 783-4009. WWW.STANDARDANDPOORS.COM/RATINGSDIRECT JUNE 6, 2014 6 1329931 | 301112013 Research Update: Ratings On Saudi Arabia Affirmed At 'AA-/A-1+'; Outlook Remains Positive S&P may receive compensation for its ratings and certain analyses, normally from issuers or underwriters of securities or from obligors. S&P reserves the right to disseminate its opinions and analyses. S&P's public ratings and analyses are made available on its Web sites, www.standardandpoors.com (free of charge), and www.ratingsdirect.com and www.globalcreditportal.com (subscription) and www.spcapitaliq.com (subscription) and may be distributed through other means, including via S&P publications and third-party redistributors. Additional information about our ratings fees is available at www.standardandpoors.com/usratingsfees. S&P keeps certain activities of its business units separate from each other in order to preserve the independence and objectivity of their respective activities. As a result, certain business units of S&P may have information that is not available to other S&P business units. S&P has established policies and procedures to maintain the confidentiality of certain nonpublic information received in connection with each analytical process. To the extent that regulatory authorities allow a rating agency to acknowledge in one jurisdiction a rating issued in another jurisdiction for certain regulatory purposes, S&P reserves the right to assign, withdraw, or suspend such acknowledgement at any time and in its sole discretion. S&P Parties disclaim any duty whatsoever arising out of the assignment, withdrawal, or suspension of an acknowledgment as well as any liability for any damage alleged to have been suffered on account thereof. Credit-related and other analyses, including ratings, and statements in the Content are statements of opinion as of the date they are expressed and not statements of fact. S&P's opinions, analyses, and rating acknowledgment decisions (described below) are not recommendations to purchase, hold, or sell any securities or to make any investment decisions, and do not address the suitability of any security. S&P assumes no obligation to update the Content following publication in any form or format. The Content should not be relied on and is not a substitute for the skill, judgment and experience of the user, its management, employees, advisors and/or clients when making investment and other business decisions. S&P does not act as a fiduciary or an investment advisor except where registered as such. While S&P has obtained information from sources it believes to be reliable, S&P does not perform an audit and undertakes no duty of due diligence or independent verification of any information it receives. No content (including ratings, credit-related analyses and data, valuations, model, software or other application or output therefrom) or any part thereof (Content) may be modified, reverse engineered, reproduced or distributed in any form by any means, or stored in a database or retrieval system, without the prior written permission of Standard & Poor's Financial Services LLC or its affiliates (collectively, S&P). The Content shall not be used for any unlawful or unauthorized purposes. S&P and any third-party providers, as well as their directors, officers, shareholders, employees or agents (collectively S&P Parties) do not guarantee the accuracy, completeness, timeliness or availability of the Content. S&P Parties are not responsible for any errors or omissions (negligent or otherwise), regardless of the cause, for the results obtained from the use of the Content, or for the security or maintenance of any data input by the user. The Content is provided on an "as is" basis. S&P PARTIES DISCLAIM ANY AND ALL EXPRESS OR IMPLIED WARRANTIES, INCLUDING, BUT NOT LIMITED TO, ANY WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR USE, FREEDOM FROM BUGS, SOFTWARE ERRORS OR DEFECTS, THAT THE CONTENT'S FUNCTIONING WILL BE UNINTERRUPTED, OR THAT THE CONTENT WILL OPERATE WITH ANY SOFTWARE OR HARDWARE CONFIGURATION. In no event shall S&P Parties be liable to any party for any direct, indirect, incidental, exemplary, compensatory, punitive, special or consequential damages, costs, expenses, legal fees, or losses (including, without limitation, lost income or lost profits and opportunity costs or losses caused by negligence) in connection with any use of the Content even if advised of the possibility of such damages. Copyright 2014 Standard & Poor's Financial Services LLC, a part of McGraw Hill Financial. All rights reserved. WWW.STANDARDANDPOORS.COM/RATINGSDIRECT JUNE 6, 2014 7 1329931 | 301112013