Negative outlook for GCC sovereigns as recovery could take up to 3 years - Moody's | ZAWYA MENA Edition
It will take two to three years for real, inflation-adjusted GDP in GCC sovereigns to return to pre-pandemic levels, Moody’s Investors Service said in a report Wednesday.
Even then recovery will take the longest in the more economically diversified sovereigns, where key sectors such as transportation and tourism will be slow to bounce back, the ratings agency said in its outlook for sovereign creditworthiness among GCC members.
"Our negative outlook for GCC sovereigns reflects the coronavirus pandemic's impact on oil revenue and our expectations for the erosion of fiscal strength experienced last year to extend throughout 2021," said Thaddeus Best, a Moody's analyst and the report's co-author.
In most cases, however, access to vast sovereign wealth fund (SWF) assets continued to buttress very high fiscal strength, despite significantly lower oil prices, contracting economic activity and significantly lower revenue.
The report forecasts that GCC government debt burdens will rise on average by around 21 percentage points of GDP over 2019-21, compared with 14 percentage points on average for advanced economies.
No comments:
Post a Comment