In the report, the rating affirmation is based on Moody's assessment of the government's significant progress that achieved in implementing broad-based reform agenda since 2016 and the track record of macroeconomic and fiscal policy effectiveness that will support the sustainability of the economic diversification.
The agency also expects the continued implementation of large diversification projects in the Kingdom will support non-hydrocarbon real GDP growth as they are designed to be modular and commercialized in phases.
The National Debt Management Center (NDMC) has announced the completion of the 2026 Annual Borrowing Plan, having secured approximately 90% of the Kingdom's funding needs prior to the geopolitical events in the region. This reflects the efficiency of proactive planning and execution flexibility in managing the Kingdom's funding needs.The Agency also mentioned that the positive outlook is a reflection of the reforms and investments in various non-oil sectors that will, over time, lead to a material decline in the Kingdoms economic and fiscal reliance on hydrocarbons.
Should the ongoing coordination with the Ministry of Finance identify a need for additional financing, NDMC intends to leverage private channels and local markets as the primary funding sources.
While issuances in international public markets were selectively reduced than initially anticipated in the 2026 Annual Borrowing Plan, NDMC successfully met its funding needs through private channels and the local market. This approach underscores the Kingdom's commitment to maintaining public debt sustainability and diversifying its funding sources and instruments. NDMC will continue to monitor international public markets and consider accessing them when favorable opportunities arise, with the aim of meeting future financing needs.
Moody's also touched on the Kingdoms large economy, improving institutions and policy effectiveness, robust balance sheet and large foreign currency buffers.