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15 Apr 2019, Gergana Bencheva, EMIS Editor

Fitch confirms Kuwait’s “AA” rating

Credit rating agency Fitch has affirmed Kuwait's long-term foreign-currency Issuer Default Rating (IDR) at “AA”, preserving its stable outlook, CEEMarketWatch reported. The agency underlined that the country's key credit strengths were its exceptionally strong fiscal and external metrics.

Yet, Fitch noted that Kuwait remained a heavily oil-dependent economy. Furthermore, it is exposed to a geopolitical risk, and has been showing weak indicators of governance and business environment. The country’s public finances are also challenged by the generous welfare state combined with the large economic role of the public sector.

According to the credit specialist, in 2018, the foreign assets of Kuwait Investment Authority (KIA) reached USD 561 billion, or 394% of the country’s gross domestic product (GDP). Fitch estimates that the government would post a surplus of around KWD 3.3 billion, or 7.9% of GDP, for the current fiscal year ending in March 2019, CEEMarketWatch added.

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