Today, Thursday, Fitch announced the downgrade of Kuwait’s rating from AA- to AA- and gave a stable outlook.
Fitch said the rating reflects the difficulty of making fundamental decisions on the public sector and reducing dependence on oil.
Standard & Poor’s S&P downgraded Kuwait to A + due to the lack of a global funding strategy, noting that the outlook remains negative.
In a previous report, Moody’s said that Kuwait has a number of strengths that support its credit rating, which are represented by the country’s possession of enormous and exceptional oil wealth, low total public debt, enormous size of asset sovereign wealth funds, and the very high level of per capita income.
On the other hand, the report highlighted the challenges facing the creditworthiness of the country, which are represented by the strong dependence on the oil sector, and the consequent economic and financial fluctuations, and the strained relationship between the government and the Assembly. which weakens policy making and undermines the state’s ability to adapt to regional geopolitical shocks and tensions. He indicated that there are 3 factors that can contribute to lowering the country’s rating by more than one degree if achieved.
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