Kuwait’s Sovereign Ratings Affirmed; Outlook Revised to Negative Rating Action

Ref: KW 2 1 CRA00- 0 1 5 February 2021

Kuwait’s Sovereign Ratings Affirmed; Outlook Revised to Negative Rating Action

Capital Intelligence Ratings (CI Ratings or CI ) today announced that it has revised the Outlook on Kuwait’s Long-Term Foreign C urrency Rating (LT FC R ) and Long-Term Local Currency Rating (LT LC R ) to Negative from Stable. At the same time t he sovereign’s LT FCR and LT LCR have been affirmed at ‘AA-’ , while its Short-Term ( ST ) FC R and ST LC R have been affirmed at ‘ A1+’.

Rating Rationale

The change in the Outlook to Negative reflects increasing government liquidity pressures arising from the combination of a large budget deficit, the imminent depletion of the assets of the General Reserve Fund (GRF , the government’s treasury account ), and the absence of parliamentary authori s ation f or new borrowing due to the ongoing political impasse over the proposed public debt law.

T he…