Ratings agency S&P’s cites public spending, diminished political tensions for move
Bahrain and Oman were removed from CreditWatch negative by
Standard & Poor’s Ratings Services, which cited measures to ease political
tensions in both Gulf nations.
Bahrain’s long- and short-term local and foreign currency
sovereign credit ratings were affirmed at ‘BBB/A-3’ with negative implications,
S&P said in an emailed statement Wednesday.
Oman’s ‘A/A-1’ long-term and short-term local and foreign
currency ratings were affirmed, S&P said in a separate statement.
S&P cited “the diminished near-term political tensions
and our expectation that increased public spending will lift economic growth
next year,” in its statement on Bahrain. Oman benefits from “political
pressures easing,” S&P said.
Both nations had been placed on CreditWatch negative in
Protesters in Oman and Bahrain held popular movements
earlier this year demanding free elections and more housing and jobs, echoing
uprisings that have swept the region and unseated rulers in Tunisia and Egypt.
At least two people have died in clashes between demonstrators and security
forces in Oman, while at least 30 people have been killed in Bahrain, the
Associated Press reported.
The Gulf Cooperation Council states said March 10 that they
would provide Oman and Bahrain with $10bn each over a decade for the
development of infrastructure and housing.
The Central Bank of Bahrain, Bahrain Mumtalakat Holding Co,
the sovereign wealth fund, and Oman Power and Water Procurement Co were also
removed from credit watch negative, S&P said. The outlook is negative for
Bahrain’s real gross domestic product will expand 1.4
percent this year, down from a previous estimate of 4.3 percent, Barclays
Capital said in April.
Oman’s economic growth estimate was downgraded to 4.5
percent from 5.2 percent, the bank said.