MUSCAT (AFP) – Moody’s Investors Service on Thursday raised the sovereign ratings of the Gulf state of Oman on the back of the strength of its public finances.
Oman’s local and foreign currency government bond ratings and the country ceiling for foreign currency bank deposits were both raised to A1 from A2, and the country ceiling for foreign currency bonds was raised to Aa2 from Aa3.
The ratings outlook is stable, Moody’s said in a statement.
“The main driver of today’s rating change is the comparative strength of Oman’s public finances within its rating peer group,” said Tristan Cooper, a vice president and senior credit officer in Moody’s Sovereign Risk Group.
“Despite a sharp fall in average oil prices in 2009, the Omani government has managed to keep its fiscal account close to balance,” he said.
“In Moody’s opinion, Oman’s economy has navigated through the global economic crisis in relatively good shape. Although the country’s real non-oil growth fell sharply in 2009, it remained in positive territory,” Moody’s said.
Oman’s financial sector was less affected by the global economic crisis and the country’s modest level of indebtedness has limited its external vulnerability, the global ratings agency said.
However, a collapse in Oman’s oil production or international oil prices could put the southern Gulf sultanate’s sovereign ratings under pressure, Moody’s said.
Oman oil reserves are modest in comparison with neighbouring Gulf countries, standing at 5.5 billion barrels in January 2009.