“Moody's” affirmed the UAE's long-term sovereign rating in both local and foreign currencies at Aa2 with a stable outlook. The rating is based on Moody's' assessment that the level of federal government debt in the UAE will remain very low, supported by the UAE's continued commitment to balanced budgeting goals, in addition to the fact that the institutional strength and policies put in place by the country contribute to promoting economic diversification away from dependence on oil.
The stable outlook reflects the agency's expectation that the government's ongoing efforts across the country to boost non-oil sector revenues and attract foreign companies and talent may reduce the federal government's indirect exposure to oil price cycles.
The rating of the UAE's local and foreign currency ceiling remained unchanged at AAA, due to the Central Bank's abundant foreign currency reserves.
“Moody's” expects the UAE's real GDP to grow by 4 percent in 2023, compared to 7.6 percent in 2022 and 3.9 percent in 2021, driven by a modest contraction in oil production as agreed with the Organization of the Petroleum Exporting Countries (OPEC) and its partners. However, the non-oil economy is likely to remain active, growing by 6 percent in 2023.
Source (Al Khaleej Newspaper, UAE, Edited)
