Moody's Investors Service has affirmed the ratings of six Saudi Arabian companies and revised their outlook to “positive” from “stable”, as the Arab world’s largest economy continues to carry out significant reforms to diversify its non-oil economy.
The six entities whose credit ratings were affirmed at 'A1' are Saudi Aramco, the world’s largest oil supplier; the Public Investment Fund, the kingdom’s sovereign wealth fund; Saudi Basic Industries Corporation the Middle East’s largest petrochemical producer; Saudi Telecom Company, the country's biggest mobile operator; Saudi Power Procurement Company and Saudi Electricity Company.
The rating actions follow Moody's decision last week to affirm the 'A1' rating of Saudi Arabia and change the outlook to positive from stable.
“Today's rating actions are a direct consequence of the sovereign rating action and reflect the credit linkages between Saudi Arabia and each of the six entities,” Moody’s said on Thursday.
“While these corporates benefit to varying degrees from international assets and cash flows, they all have significant credit linkages to the Saudi Arabia sovereign and are exposed to the domestic environment including political, economic, regulatory and social factors.”
Aramco’s A1 rating reflects its large operational scale, significant downstream integration and strong financial flexibility given its low cost structure and low leverage relative to cash flows, the New York-based credit rating agency said.
These traits offer resilience through oil price cycles and also help mitigate carbon transition risk, which is a material credit consideration for oil and gas companies.
One of the world’s largest sovereign wealth funds, the PIF receives contributions from the government, both monetary and through asset transfers, Moody’s said. It expects the fund to maintain sizeable cash balances, in addition to an undrawn rapid credit facility (RCF) to fund potential acquisitions and investments.
With about $620 billion in assets under management, the PIF is at the centre of the Saudi Vision 2030 initiative to diversify the country’s economy away from hydrocarbons.
Under a five-year strategy announced in 2021, the PIF aims to more than double the value of its assets under management to $1.07 trillion and commit $40 billion annually to develop Saudi Arabia's economy until 2025.
Sabic, which is set to play a key role in the kingdom’s plan to reduce its reliance on oil exports, benefits from a competitive cost position and significant economies of scale, according to Moody's.
Its A1 rating continues to reflect its strong global position in the petrochemical and fertiliser market, as well as its competitive cost position, the rating agency said.
The petrochemicals industry is expected to be a major driver of crude demand over the next few decades as consumers increasingly switch to electric vehicles.
Globally, the sector is projected to be worth about $800 billion by 2030, up from about $475 billion in 2020, according to Precedence Research.
Last year, Sabic announced plans to set up a plant to convert crude oil into petrochemicals in Ras Al Khair, with a capacity of 400,000 barrels per day of oil.
The credit profile of STC, meanwhile, which has operations in the Middle East and Asia, reflects its leading position in the lucrative Saudi telecoms market, with a market share of about 72 per cent, Moody's said.
The A1 rating of Saudi Power Procurement Company is based on its low business risk profile, Moody’s said. The company is the licensed monopoly principal buyer of electricity in Saudi Arabia and a wholly owned entity of the government.
Saudi Arabia is in the middle of a major economic diversification drive under its Vision 2030 agenda, amid a push to reduce its reliance on oil and tap into other high-growth industries to boost its economy, create more jobs and attract private investment.
The kingdom had the highest annual growth rate among the world's 20 biggest economies in 2022, according to the latest data from the Organisation for Economic Co-operation and Development.
The country's economy expanded 8.7 per cent last year on higher oil prices and the strong performance of its non-oil private sector.
Business activity in the non-oil economy of Saudi Arabia hit an eight-year high in February as output growth in the kingdom strengthened, according to the Riyad Bank purchasing managers’ index.
Avatar: Fire and Ash
Director: James Cameron
Starring: Sam Worthington, Sigourney Weaver, Zoe Saldana
Rating: 4.5/5
ICC T20 Rankings
1. India - 270 ranking points
2. England - 265 points
3. Pakistan - 261 points
4. South Africa - 253 points
5. Australia - 251 points
6. New Zealand - 250 points
7. West Indies - 240 points
8. Bangladesh - 233 points
9. Sri Lanka - 230 points
10. Afghanistan - 226 points
Favourite book: ‘The Art of Learning’ by Josh Waitzkin
Favourite film: Marvel movies
Favourite parkour spot in Dubai: Residence towers in Jumeirah Beach Residence
COMPANY%20PROFILE
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Should late investors consider cryptocurrencies?
Wealth managers recommend late investors to have a balanced portfolio that typically includes traditional assets such as cash, government and corporate bonds, equities, commodities and commercial property.
They do not usually recommend investing in Bitcoin or other cryptocurrencies due to the risk and volatility associated with them.
“It has produced eye-watering returns for some, whereas others have lost substantially as this has all depended purely on timing and when the buy-in was. If someone still has about 20 to 25 years until retirement, there isn’t any need to take such risks,” Rupert Connor of Abacus Financial Consultant says.
He adds that if a person is interested in owning a business or growing a property portfolio to increase their retirement income, this can be encouraged provided they keep in mind the overall risk profile of these assets.
Dengue%20fever%20symptoms
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Other acts on the Jazz Garden bill
Sharrie Williams
The American singer is hugely respected in blues circles due to her passionate vocals and songwriting. Born and raised in Michigan, Williams began recording and touring as a teenage gospel singer. Her career took off with the blues band The Wiseguys. Such was the acclaim of their live shows that they toured throughout Europe and in Africa. As a solo artist, Williams has also collaborated with the likes of the late Dizzy Gillespie, Van Morrison and Mavis Staples.
Lin Rountree
An accomplished smooth jazz artist who blends his chilled approach with R‘n’B. Trained at the Duke Ellington School of the Arts in Washington, DC, Rountree formed his own band in 2004. He has also recorded with the likes of Kem, Dwele and Conya Doss. He comes to Dubai on the back of his new single Pass The Groove, from his forthcoming 2018 album Stronger Still, which may follow his five previous solo albums in cracking the top 10 of the US jazz charts.
Anita Williams
Dubai-based singer Anita Williams will open the night with a set of covers and swing, jazz and blues standards that made her an in-demand singer across the emirate. The Irish singer has been performing in Dubai since 2008 at venues such as MusicHall and Voda Bar. Her Jazz Garden appearance is career highlight as she will use the event to perform the original song Big Blue Eyes, the single from her debut solo album, due for release soon.
The bio
Favourite book: The Alchemist by Paulo Coelho
Favourite travel destination: Maldives and south of France
Favourite pastime: Family and friends, meditation, discovering new cuisines
Favourite Movie: Joker (2019). I didn’t like it while I was watching it but then afterwards I loved it. I loved the psychology behind it.
Favourite Author: My father for sure
Favourite Artist: Damien Hurst
The specs: 2018 Ducati SuperSport S
Price, base / as tested: Dh74,900 / Dh85,900
Engine: 937cc
Transmission: Six-speed gearbox
Power: 110hp @ 9,000rpm
Torque: 93Nm @ 6,500rpm
Fuel economy, combined: 5.9L / 100km
Ten tax points to be aware of in 2026
1. Domestic VAT refund amendments: request your refund within five years
If a business does not apply for the refund on time, they lose their credit.
2. E-invoicing in the UAE
Businesses should continue preparing for the implementation of e-invoicing in the UAE, with 2026 a preparation and transition period ahead of phased mandatory adoption.
3. More tax audits
Tax authorities are increasingly using data already available across multiple filings to identify audit risks.
4. More beneficial VAT and excise tax penalty regime
Tax disputes are expected to become more frequent and more structured, with clearer administrative objection and appeal processes. The UAE has adopted a new penalty regime for VAT and excise disputes, which now mirrors the penalty regime for corporate tax.
5. Greater emphasis on statutory audit
There is a greater need for the accuracy of financial statements. The International Financial Reporting Standards standards need to be strictly adhered to and, as a result, the quality of the audits will need to increase.
6. Further transfer pricing enforcement
Transfer pricing enforcement, which refers to the practice of establishing prices for internal transactions between related entities, is expected to broaden in scope. The UAE will shortly open the possibility to negotiate advance pricing agreements, or essentially rulings for transfer pricing purposes.
7. Limited time periods for audits
Recent amendments also introduce a default five-year limitation period for tax audits and assessments, subject to specific statutory exceptions. While the standard audit and assessment period is five years, this may be extended to up to 15 years in cases involving fraud or tax evasion.
8. Pillar 2 implementation
Many multinational groups will begin to feel the practical effect of the Domestic Minimum Top-Up Tax (DMTT), the UAE's implementation of the OECD’s global minimum tax under Pillar 2. While the rules apply for financial years starting on or after January 1, 2025, it is 2026 that marks the transition to an operational phase.
9. Reduced compliance obligations for imported goods and services
Businesses that apply the reverse-charge mechanism for VAT purposes in the UAE may benefit from reduced compliance obligations.
10. Substance and CbC reporting focus
Tax authorities are expected to continue strengthening the enforcement of economic substance and Country-by-Country (CbC) reporting frameworks. In the UAE, these regimes are increasingly being used as risk-assessment tools, providing tax authorities with a comprehensive view of multinational groups’ global footprints and enabling them to assess whether profits are aligned with real economic activity.
Contributed by Thomas Vanhee and Hend Rashwan, Aurifer
Sholto Byrnes on Myanmar politics
Company%20profile
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Empty Words
By Mario Levrero
(Coffee House Press)
Company%20profile
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How it works
Each player begins with one of the great empires of history, from Julius Caesar's Rome to Ramses of Egypt, spread over Europe and the Middle East.
Round by round, the player expands their empire. The more land they have, the more money they can take from their coffers for each go.
As unruled land and soldiers are acquired, players must feed them. When a player comes up against land held by another army, they can choose to battle for supremacy.
A dice-based battle system is used and players can get the edge on their enemy with by deploying a renowned hero on the battlefield.
Players that lose battles and land will find their coffers dwindle and troops go hungry. The end goal? Global domination of course.
Dubai Bling season three
Cast: Loujain Adada, Zeina Khoury, Farhana Bodi, Ebraheem Al Samadi, Mona Kattan, and couples Safa & Fahad Siddiqui and DJ Bliss & Danya Mohammed
Rating: 1/5
Five%20calorie-packed%20Ramadan%20drinks
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