Abu Dhabi sovereign rating resilient; Dubai upgrade uninhibited by slow growth | ZAWYA MENA Edition:
"Growth in the emirates of Abu Dhabi and Dubai will remain at a sustained level of approximately three per cent over the next few years, if oil prices remain stable around current levels; growth is predicted to be steady, albeit modest when compared with over four per cent per annum achieved pre-2015, according to Fisch Asset Management (Fisch), one of the leading credit analysis and convertible bond specialists. A report by Independent Credit Review (I-CV), a subsidiary of Fisch, confirmed Abu Dhabi’s credit quality as AA-, with the emirate benefitting from comfortable reserves, but with a forecast of slightly negative national budgets and rising debt levels over the coming years. Dubai received an upgrade to BBB+, stemming from a gradual reduction in total debt, including contingent obligations from state-owned companies, from 141 per cent at the end of 2013 to 111 per cent at the end of 2016. The selective introduction of import tariffs and VAT will not negatively impact economic growth in the emirates but will instead support the fiscal situation in light of lower oil-related activities, according to the report."
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