Qatar's Fitch Credit Rating Elevated to AA, Exceeds UK and France

Qatar, 21 March, 2024 : Qatar's Fitch credit rating has been upgraded to "AA," surpassing that of major economies like the UK and France. Fitch Ratings assigned a long-term foreign-currency issuer default rating (IDR) of "AA" to Qatar, an improvement from the previous “AA-”. This places Qatar ahead of both the UK and France, which currently hold an AA- credit rating.

The upgrade reflects Fitch's confidence in Qatar's ability to maintain its debt to GDP ratio in line with or below the “AA” peer median. This is attributed to the country's strong external balance sheet and forecasted budget surpluses, driven by projects like the North Field expansion.

Qatar is expected to achieve a general government budget surplus of 8.6% of GDP in the current year and 6.2% in 2025, according to Fitch. The ratings agency highlights Qatar's large sovereign net foreign assets, high GDP per capita ratio, and flexible public finance structure as factors supporting its “AA” ratings.

However, Fitch notes weaknesses such as Qatar's heavy reliance on hydrocarbons, below-average governance scores, higher government debt/GDP compared to oil-dependent highly rated peers, and significant contingent liabilities.

Source : www.zawya.com