Oman retains investment grade rating

Oman’s Ministry of Finance has said that the recent Moody’s rating, which resulted in a one-point downgrade of the Sultanate’s credit rating, was equivalent to the credit rating granted by Fitch to the Sultanate and two points higher than Standard & Poor’s (S&P).

The ministry said in a statement to Oman News Agency that the rating by Moody’s of the Sultanate is still investment grade. Moody’s has based its assessment on the assumption that the measures taken so far are insufficient considering the size of the decline in revenues. 

It pointed out that international rating institutions focused in their assessment mainly on financial indicators, the financial position of the state, which includes income, expenditure, deficit and ability of the state to finance this deficit and its impact on its financial reserves. It is clear that the financial situation has been greatly affected by the sharp and prolonged decline in oil prices, the main source of government income, it.

The Government has taken measures since the oil price slump of late 2014, but some results will take time to pay off and show effect.

Taking into account the social and economic effects of measures, it has followed the principle of gradualism in the face of this crisis. It is constantly monitoring the financial condition. It will take appropriate and balanced measures to maintain the integrity and stability of the financial and economic situation of the state as the financial procedures may have a deflation effect.

The Finance Ministry has added that it is hoped that the economic measures taken by the Government and those in the process of release to mitigate the effects of deflation resulting from financial procedures, by creating conducive environment for both domestic and foreign investments and thus achieving appropriate growth rates in the national economy.