Fitch: Oman’s Long-Term Foreign Currency Issuer Default Rating Downgraded to BB-; Negative Outlook

Oman’s Long-Term Foreign Currency Issuer Default Rating (IDR) has been downgraded to BB- from BB by Fitch Ratings (Fitch), with a Negative Outlook.

The downgrade and Negative Outlook is based on the on-going weakening of Oman’s fiscal and balance sheets, hastened by lower oil prices and the negative impact of the COVID-19, despite an improved underlying fiscal consolidation.

Fitch forecasts Oman’s budget shortfall to be nearly 20% of gross domestic product (GDP) in 2020, compared with around 8% of GDP in 2019. Government debt is expected to increase to over 80% of GDP in 2020 from 60% of GDP in 2019, due to a 16% reduction in nominal GDP. Furthermore, Fitch expects...