March 22, 2017 / 1:32 PM / 8 months ago

BRIEF-Fitch downgrades Saudi Arabia to 'A+'; outlook stable

March 22 (Reuters) - Fitch:

* Fitch downgrades Saudi Arabia to ‘A+'; outlook stable

* Fitch on Saudi Arabia - expect central government deficit to fall to 9.2% of GDP in 2017 and 7.1% of GDP in 2018

* Fitch on Saudi Arabia - general government debt will rise to 14.5% of GDP in 2018

* Fitch on Saudi Arabia - expects non-oil sector to grow by 1.4% in 2017, supported by arrears payments in late 2016 and early 2017

* Fitch says views Saudi Arabia’s banking sector as strong and stable

* downgraded Saudi Arabia’s long-term foreign and local currency issuer default ratings to ‘A+’ from ‘AA-'.

* Fitch says Saudi Arabia’s geopolitical risks remain high relative to its ‘A’ category peers.

* Fitch says “tensions with Iran, Saudi Arabia’s main regional rival, also persist and could escalate, although direct military conflict remains highly unlikely”

* Fitch says Saudi Arabia’s “line of succession has been clearly defined, but Fitch believes rivalries within royal family could become a source of instability”

* Fitch says downgrade of Saudi Arabia’s long-term IDRs reflects continued deterioration of public and external balance sheets

* Fitch says downgrade of Saudi Arabia’s long-term IDRs also reflect significantly wider than expected fiscal deficit in 2016

* Fitch says downgrade of Saudi Arabia’s long-term IDRs also reflect continued doubts about extent to which government’s reform programme can be implemented Source text for Eikon:

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