Today, Thursday, Fitch announced the downgrade of Kuwait’s credit rating from AA- to AA-, and gave it a stable outlook.
Fitch said the rating reflects the difficulty of making fundamental decisions regarding the public sector and reducing dependence on oil.
Standard & Poor’s ratings agency S&P downgraded Kuwait to A+ due to the lack of a comprehensive financing strategy, noting that the outlook remains negative.
In a previous report, Moody’s saidKuwait possesses a number of strengths that support its credit rating, which are represented in the country’s possession of huge and exceptional oil wealth, the low total government debt, the huge size of the assets of sovereign wealth funds, and the very high level of per capita income.
On the other hand, the report pointed to the challenges facing the country’s credit rating, which are represented in the heavy dependence on the oil sector, and the resulting economic and financial fluctuations, and the tense relationship between the government and the National Assembly, which weakens the formation of policies and undermines the state’s ability to adapt to shocks, and regional geopolitical tensions. He indicated that there are 3 factors that may contribute to lowering the country’s rating by more than one degree if they are achieved.
