Dubai: Credit rating agency Standard & Poor’s (S&P) has lowered its long-term rating on the State of Qatar to AA- from AA and placed the rating on credit watch with negative implications.
The rating downgrade and negative outlook comes following a group of states including Saudi Arabia, the UAE, Bahrain, Egypt, Libya, and Yemen moved to cut diplomatic ties, as well as trade and transport links, with Qatar. The measures imposed include a blockade of land, sea, and air access and the expulsion of Qatari officials, residents, and visitors from the group of states.
“We believe this will exacerbate Qatar's external vulnerabilities and could put pressure on its economic growth and fiscal metrics. The negative credit watch encompasses numerous downside risks to the ratings as a consequence of recent events. At this stage, we note that there are numerous uncertainties regarding Qatar's response, the extent to which these measures will be imposed, and their longevity,” S&P said in a note.
The rating agency expects to review this and the potential impact on their projections as further details emerge.
