Saudi Ministry of Finance has rejected the unprofessional decision of «Standard & Poor's» agency to reduce Saudi Arabia's credit rating to (+ A) with a negative outlook. The ministry confirmed that the Kingdom economy is characterized as it is supported by net assets of more than 100 per cent of GDP, in addition to a large reserve of foreign exchange.
According to the newspaper "Middle East", «Moody's» agency is preparing to issue its credit rating for the Kingdom during these days, amid an initial indicators confirm that the ratings will not be consistent with the rating of «Standard & Poor's», which was based on inaccurate information and numbers collected through Internet sites, and through unofficial sources.
The Saudi Ministry of Finance explained in a statement yesterday, that the decision of «Standard & Poor's» to downgrade the credit rating of the Kingdom was an act of the agency, and was not based on a formal request. It has pointed to the lack of its agreement with the system used in this evaluation which it described as « hasty and unjustified reaction did not assign to the facts."
The ministry said in a statement that "Nothing is more indicative that the assessment is hasty and unjustified, that it downgrade the rating in less than a year from -AA with a positive outlook to A+ with a negative outlook, based solely on the global oil price changes, without consideration to other positive fundamental factors, which, if taken into account would have emphasized the previous assessment, at least. "
It emphasized that the agency decision was not only hasty but inconsistent substantially with the idea of Classification and its technical fundamentals, which requires that impartial Classification to takes into account all dimensions affecting the creditworthiness of the work, and which confirms the ministry's stance is the big difference between the methodology and results of the rating between other international rankings agencies.
According to newspaper 'AL Ektsadeah", Saudis specialists confirmed that Stand & Poor's credit rating of Kingdom in its last report ignored the fact that the Saudi economy is witnessing economic growth over recent years, in addition to the availability of huge foreign cash reserves.
They pointed out that the Agency did not adopt in its classification accurate information, particularly it is built on estimates of future oil prices which brook change between now and then.
Habibullah Turkestan, Professor of Economics, explained that the downgrade was based on a decline in the Kingdom's oil revenues, stressing that it is not necessary that this be true, he did not rule out political objectives to be behind that, stressing that "the kingdom has monetary policies and financial reserves can benefit from it in the face of any financial crises. "
