Moody’s Investors Services has published its first report on Sharjah, awarding the emirate with a A3 stable rating. The rating, which reflects the emirate’s credit strength, is primarily supported by its very strong fiscal and government debt position, noting that government debt is at low levels.
A few months ago, global credit rating agency S&P announced its first ever sovereign credit rating for Sharjah awarding it an ‘A/A-1′ rating with a Stable Outlook. Both ratings underscore the solid fundamentals of Sharjah’s economy and its strong fiscal policy.
The Moody’s report highlights that the new credit rating is supported by Sharjah’s competitive manufacturing sector and a relatively higher degree of economic diversification — compared to the rest of the United Arab Emirates (UAE, Aa2 stable) and countries in the Gulf Cooperation Council (GCC). However, the report also noted that given the size of the emirate’s economy and its economic links with the rest of the UAE, Sharjah is exposed to macroeconomic volatility.
Sharjah has become a significant contributor to the UAE’s diversification away from oil revenues and some 47 percent of the Emirate’s 2014 budget has been allocated to developing the economic sector. Sharjah’s Hamriyah Free Zone, Sharjah Airport International Free Zone and 19 industrial zones help to support a wide range of economic activities, while Sharjah International Airport and three sea ports support a thriving logistics industry in the emirate. Meanwhile, Sharjah’s real estate market is also experiencing growth with a strong demand for residential and commercial properties.
Source: Moody’s, Gulf News