Saudi Arabia is in the middle of a major economic diversification drive under its Vision 2030 agenda. Reuters
Saudi Arabia is in the middle of a major economic diversification drive under its Vision 2030 agenda. Reuters
Saudi Arabia is in the middle of a major economic diversification drive under its Vision 2030 agenda. Reuters
Saudi Arabia is in the middle of a major economic diversification drive under its Vision 2030 agenda. Reuters

Moody's affirms ratings of six Saudi corporates and revises their outlook to positive


Alkesh Sharma
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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.

  • Solar dishes can be seen behind trees at the King Abdulaziz City of Sciences and Technology. Reuters
    Solar dishes can be seen behind trees at the King Abdulaziz City of Sciences and Technology. Reuters
  • Aramco's Dhahran Research and Development Centre in Saudi Arabia's eastern region of Dhahran. AFP
    Aramco's Dhahran Research and Development Centre in Saudi Arabia's eastern region of Dhahran. AFP
  • Dr Munir El Desouki, president of King Abdul Aziz City for Science and Technology (KACST). Photo: @munireldesouki
    Dr Munir El Desouki, president of King Abdul Aziz City for Science and Technology (KACST). Photo: @munireldesouki
  • Delegates attending the fourth edition of the Future Investment Initiative (FII) conference at the capital Riyadh's Ritz-Carlton hotel in January 2021. AFP
    Delegates attending the fourth edition of the Future Investment Initiative (FII) conference at the capital Riyadh's Ritz-Carlton hotel in January 2021. AFP
  • A Saudi host addressing guests during a presentation on the Saudi Green Initiative earlier in July, which includes goals for tree-planting and reducing emissions. AFP
    A Saudi host addressing guests during a presentation on the Saudi Green Initiative earlier in July, which includes goals for tree-planting and reducing emissions. AFP
  • A beacon rises above the harbour at the King Abdullah University of Science and Technology near Jeddah. Reuters
    A beacon rises above the harbour at the King Abdullah University of Science and Technology near Jeddah. Reuters
  • Visitors test VR glasses at the Mobile World Congress 2019 in Barcelona at the Saudi Telecom Company stand. Photo: dpa
    Visitors test VR glasses at the Mobile World Congress 2019 in Barcelona at the Saudi Telecom Company stand. Photo: dpa
  • The Operations Co-ordination Centre in Dhahran in eastern Saudi Arabia. AFP
    The Operations Co-ordination Centre in Dhahran in eastern Saudi Arabia. AFP

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.

The%20specs
%3Cp%3E%3Cstrong%3EEngine%3A%3C%2Fstrong%3E%20Dual%20synchronous%20electric%20motors%0D%3Cbr%3E%3Cstrong%3EPower%3A%20%3C%2Fstrong%3E660hp%0D%3Cbr%3E%3Cstrong%3ETorque%3A%20%3C%2Fstrong%3E1%2C100Nm%0D%3Cbr%3E%3Cstrong%3ETransmission%3A%20%3C%2Fstrong%3ESingle-speed%20automatic%0D%3Cbr%3E%3Cstrong%3ETouring%20range%3A%20%3C%2Fstrong%3E488km-560km%0D%3Cbr%3E%3Cstrong%3EPrice%3A%20%3C%2Fstrong%3EFrom%20Dh850%2C000%20(estimate)%0D%3Cbr%3E%3Cstrong%3EOn%20sale%3A%20%3C%2Fstrong%3EOctober%3C%2Fp%3E%0A

Dubai Rugby Sevens

November 30, December 1-2
International Vets
Christina Noble Children’s Foundation fixtures

Thursday, November 30:

10.20am, Pitch 3, v 100 World Legends Project
1.20pm, Pitch 4, v Malta Marauders

Friday, December 1:

9am, Pitch 4, v SBA Pirates

The Bio

Name: Lynn Davison

Profession: History teacher at Al Yasmina Academy, Abu Dhabi

Children: She has one son, Casey, 28

Hometown: Pontefract, West Yorkshire in the UK

Favourite book: The Alchemist by Paulo Coelho

Favourite Author: CJ Sansom

Favourite holiday destination: Bali

Favourite food: A Sunday roast

Heavily-sugared soft drinks slip through the tax net

Some popular drinks with high levels of sugar and caffeine have slipped through the fizz drink tax loophole, as they are not carbonated or classed as an energy drink.

Arizona Iced Tea with lemon is one of those beverages, with one 240 millilitre serving offering up 23 grams of sugar - about six teaspoons.

A 680ml can of Arizona Iced Tea costs just Dh6.

Most sports drinks sold in supermarkets were found to contain, on average, five teaspoons of sugar in a 500ml bottle.

The specs

Price, base / as tested Dh1,100,000 (est)

Engine 5.2-litre V10

Gearbox seven-speed dual clutch

Power 630bhp @ 8,000rpm

Torque 600Nm @ 6,500rpm

Fuel economy, combined 15.7L / 100km (est) 

UAE currency: the story behind the money in your pockets
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

GAC GS8 Specs

Engine: 2.0-litre 4cyl turbo

Power: 248hp at 5,200rpm

Torque: 400Nm at 1,750-4,000rpm

Transmission: 8-speed auto

Fuel consumption: 9.1L/100km

On sale: Now

Price: From Dh149,900

How to watch Ireland v Pakistan in UAE

When: The one-off Test starts on Friday, May 11
What time: Each day’s play is scheduled to start at 2pm UAE time.
TV: The match will be broadcast on OSN Sports Cricket HD. Subscribers to the channel can also stream the action live on OSN Play.

In numbers: China in Dubai

The number of Chinese people living in Dubai: An estimated 200,000

Number of Chinese people in International City: Almost 50,000

Daily visitors to Dragon Mart in 2018/19: 120,000

Daily visitors to Dragon Mart in 2010: 20,000

Percentage increase in visitors in eight years: 500 per cent

Who's who in Yemen conflict

Houthis: Iran-backed rebels who occupy Sanaa and run unrecognised government

Yemeni government: Exiled government in Aden led by eight-member Presidential Leadership Council

Southern Transitional Council: Faction in Yemeni government that seeks autonomy for the south

Habrish 'rebels': Tribal-backed forces feuding with STC over control of oil in government territory

Race card

1.30pm: Handicap (PA) Dh 50,000 (Dirt) 1,400m

2pm: Handicap (TB) Dh 84,000 (D) 1,400m

2.30pm: Maiden (TB) Dh 60,000 (D) 1,200m

3pm: Conditions (TB) Dh 100,000 (D) 1.950m

3.30pm: Handicap (TB) Dh 76,000 (D) 1,800m

4pm: Maiden (TB) Dh 60,000 (D) 1,600m

4.30pm: Handicap (TB) Dh 68,000 (D) 1,000m

Classification of skills

A worker is categorised as skilled by the MOHRE based on nine levels given in the International Standard Classification of Occupations (ISCO) issued by the International Labour Organisation. 

A skilled worker would be someone at a professional level (levels 1 – 5) which includes managers, professionals, technicians and associate professionals, clerical support workers, and service and sales workers.

The worker must also have an attested educational certificate higher than secondary or an equivalent certification, and earn a monthly salary of at least Dh4,000. 

UAE tour of Zimbabwe

All matches in Bulawayo
Friday, Sept 26 – UAE won by 36 runs
Sunday, Sept 28 – Second ODI
Tuesday, Sept 30 – Third ODI
Thursday, Oct 2 – Fourth ODI
Sunday, Oct 5 – First T20I
Monday, Oct 6 – Second T20I

MATCH INFO

Uefa Champions League semi-final, first leg

Barcelona v Liverpool, Wednesday, 11pm (UAE).

Second leg

Liverpool v Barcelona, Tuesday, May 7, 11pm

Games on BeIN Sports

The specs

Engine: 1.5-litre turbo

Power: 181hp

Torque: 230Nm

Transmission: 6-speed automatic

Starting price: Dh79,000

On sale: Now

Keep it fun and engaging

Stuart Ritchie, director of wealth advice at AES International, says children cannot learn something overnight, so it helps to have a fun routine that keeps them engaged and interested.

“I explain to my daughter that the money I draw from an ATM or the money on my bank card doesn’t just magically appear – it’s money I have earned from my job. I show her how this works by giving her little chores around the house so she can earn pocket money,” says Mr Ritchie.

His daughter is allowed to spend half of her pocket money, while the other half goes into a bank account. When this money hits a certain milestone, Mr Ritchie rewards his daughter with a small lump sum.

He also recommends books that teach the importance of money management for children, such as The Squirrel Manifesto by Ric Edelman and Jean Edelman.

Game Changer

Director: Shankar 

Stars: Ram Charan, Kiara Advani, Anjali, S J Suryah, Jayaram

Rating: 2/5

Madrid Open schedule

Men's semi-finals

Novak Djokovic (1) v Dominic Thiem (5) from 6pm

Stefanos Tsitsipas (8) v Rafael Nadal (2) from 11pm

Women's final

Simona Halep (3) v Kiki Bertens (7) from 8.30pm

'Fantastic Beasts: The Secrets of Dumbledore'

Rating: 3/5

Directed by: David Yates

Starring: Mads Mikkelson, Eddie Redmayne, Ezra Miller, Jude Law

Imperial%20Island%3A%20A%20History%20of%20Empire%20in%20Modern%20Britain
%3Cp%3EAuthor%3A%20Charlotte%20Lydia%20Riley%3Cbr%3EPublisher%3A%20Bodley%20Head%3Cbr%3EPages%3A%20384%3C%2Fp%3E%0A
West Asia Premiership

Dubai Hurricanes 58-10 Dubai Knights Eagles

Dubai Tigers 5-39 Bahrain

Jebel Ali Dragons 16-56 Abu Dhabi Harlequins

Infiniti QX80 specs

Engine: twin-turbocharged 3.5-liter V6

Power: 450hp

Torque: 700Nm

Price: From Dh450,000, Autograph model from Dh510,000

Available: Now

Updated: March 23, 2023, 3:27 PM