Moody’s gives Jordan economy stable outlook

AMMAN  – Moody's Investors Service on Wednesday said the sovereign credit outlook for Jordan will remain stable next year at B1, as the Kingdom has proven resilient to regional unrest and has strong track records of subsidy reforms. 

In its 2015 Outlook: Global Sovereigns Report, made available to The Jordan Times, the international rating agency said Jordan has started to revamp the subsidy system and expected the fiscal deficit to recede in 2014 and 2015. 

It is broadly on track with a $2 billion 36-month International Monetary Fund programme set up in 2012, the report noted. 

Jordan was among three oil-importing countries in the region, alongside Morocco and Egypt, the agency gave stable outlooks for. 

Early this month, the international credit ratings agency Standard and Poor’s (S&P), upgraded Jordan’s outlook from negative to stable due to the country’s resilience to absorb economic and political problems caused by regional instability. 

S&P said the revised outlook for Jordan’s rating was also supported by expectations that Jordan’s fiscal and external balances will continue to improve. 

In regards to global outlook for 2015, Moody’s said it is expected to remain broadly stable as a change from the diverse global trends seen in recent years. 

The agency said nearly 80 per cent of rated sovereigns (101 out of 128) now carry stable outlooks, up from 70 per cent in January 2014 and 62 per cent in January 2013. 

Around 7 per cent have positive outlooks, while 13 per cent have negative outlooks, an improvement compared with 22 per cent negative outlooks in January 2014. 

In Europe, it said the diminishing potential for shocks as the financial and debt crises recede, as well as fiscal consolidation and somewhat improved growth prospects, have driven stabilisation and, in some cases, the beginnings of a reversal in credit and rating trends.