The Standard & Poor’s international credit ratings agency has upgraded Oman’s long-term foreign currency issuer credit and senior unsecured debt ratings to triple-‘B’ from triple-‘B’-minus, and its long-term local currency issuer credit rating on Oman to triple-‘B’-plus from triple-‘B’.
Explaining its decision, Standard & Poor’s opinion said that, with oil prices likely to be higher than expected for the foreseeable future, budget surpluses of between 5 and 6 percent GDP could result in 2001 and about 4 percent in 2002. The surpluses projected Standard & Poor’s would improve the level of the government’s reserve funds, while its debt level would remain unchanged.
The agency said that it expects the Omani government to continue with the prudent fiscal policies outlined in its 2001-2005 development plan and its 2001 budget. Both were based in a conservative level of oil production of 908,000 barrels per day and an average oil price of $18 per barrel, which is considerably below its current level.
Standard & Poor’s also upgraded its short-term local currency issuer credit rating on Oman to ‘A-2’ from ‘A-3,' and affirmed its short-term foreign currency rating at ‘A-3’.
Standard & Poor’s added that its ratings could be upgraded even further if the Omani government improves its net asset position through privatization, increases its tax revenue base, or is able to improve employment prospects for young Omanis. – (Albawaba-MEBG)
© 2001 Mena Report (www.menareport.com )