Goldman revealed that Israel and Saudi Arabia suffered critical drops in sovereign-risk scores among EM- Emerging Markets in the first half of 2024, quoted by Yahoo
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Israel:
Israel’s public finances declined due to its war with Hamas. It has been observed that the drain is done during the first six months of 2024. This war has caused major pressures on their public finances, ultimately impacting their economic outlook
Saudi Arabia:
Goldman stated that Saudi Arabia was the most prominent among neighbouring Gulf countries. The decline of Saudi Arabia’s budget is due to its new project to transform the economy, initiated by Crown Prince Mohammad Bin Salman. They have spent extensive spending on Vision 2030 projects while covering major-scale infrastructure endeavours.
This extensive spending led Saudi Arabia to face a significant decline in its sovereign risk score in Emerging Markets. It is forecasting budget deficits every year through 2026 at least.
In this regard, Soussa wrote in the Monday a report that
“Elevated spending on Vision 2030-related giga-projects reduces the scope for expenditure consolidation in the medium term,”
The change in score of both countries during the first half of this year compared with the second half of 2023 was:
Israel: -2.81
Saudi Arabia: -1.21
