Overview
Oman’s sovereign credit rating is assessed by the three major international credit rating agencies: Standard and Poor’s, Moody’s, and Fitch Ratings. The sovereign rating reflects the agencies’ assessment of Oman’s ability and willingness to meet its financial obligations, considering factors including fiscal policy, economic diversification, debt levels, foreign exchange reserves, and governance quality. Oman’s credit rating experienced downgrades during the 2014-2020 period of low oil prices and rising fiscal deficits but has since improved following the fiscal consolidation measures, higher oil prices, and structural reforms implemented under Sultan Haitham’s leadership. Credit rating upgrades have reduced Oman’s borrowing costs and improved market confidence.
Key Facts
- Assessed by Standard and Poor’s, Moody’s, and Fitch Ratings
- Rating considers fiscal policy, debt levels, reserves, and governance
- Downgrades during 2014-2020 period of fiscal pressure
- Upgrades since 2022 reflecting fiscal improvements and reforms
- Investment-grade status is a key target for fiscal policy
- Lower ratings increase government borrowing costs on international markets
- Credit outlook improved from negative to stable and positive by multiple agencies
Significance for Vision 2040
Oman’s sovereign credit rating is a barometer of international confidence in the country’s economic management and reform trajectory, making it highly relevant to Vision 2040’s success. Higher credit ratings reduce the cost of government borrowing for infrastructure and development projects that underpin Vision 2040’s implementation. Rating upgrades since 2022 validate the fiscal reforms and economic diversification progress achieved under the Vision 2040 framework. The agencies’ assessments provide external accountability for fiscal discipline, as any reversal of reform efforts would likely trigger downgrades. Achieving and maintaining investment-grade status is a priority that aligns fiscal policy with Vision 2040’s long-term objectives, ensuring that the Sultanate can access affordable financing throughout the two-decade transformation period.