ABU DHABI 11 June 2018: Standard and Poor’s continues to expect that the Abu Dhabi government’s large net asset position will provide a considerable buffer against the impact of commodity market and other volatility on the economy.
“We are therefore affirming our ‘AA/A-1+’ sovereign credit ratings on Abu Dhabi,” said the global rating agency.
“The outlook [for the emirate] is stable,” it added.
Rating Action
S&P Global Ratings affirmed its ‘AA’ long-term and ‘A-1+’short-term foreign and local currency sovereign credit ratings on Abu Dhabi, a member of the United Arab Emirates (UAE). The outlook is stable.
At the same time, we affirmed our ‘AA’ long-term foreign currency issue rating on the sovereign-guaranteed bond of senior unsecured debt issued by Waha Aerospace B.V.
Outlook
The stable outlook on Abu Dhabi reflects our expectation that economic growth will gradually pick up and that the country’s fiscal position will remain strong over the next two years, although structural and institutional weaknesses will likely persist.
“We could consider raising our ratings on Abu Dhabi if we observed pronounced improvements in data transparency, including on fiscal assets and external data, alongside further progress in institutional reforms. Moreover, measures to improve the effectiveness of monetary policy, such as developing domestic capital markets, could be positive for the ratings over time,” S&P said.