Ratings agency Moodys on Friday affirmed Saudi Arabias rating at A1and changed its outlook to "stable" from "negative", compared to its report published in June. The agency predicted the Saudi economy will return to growth in 2021, as the fiscal deficit shrinks in 2021, accompanied by a reduction in the level of debt in the medium term. Moody’s also praised the Kingdoms fiscal “policy responses in periods of both low and high oil prices.” A stable outlook suggests that in addition to the economic recovery from the pandemic and improved oil prices, the financial position and net external assets of the Kingdom remain strong enough to support its credit rating. Moodys expects that "This improvement will be sustained in the medium term because of the governments commitment to further fiscal consolidation over the coming years, including under the newly announced Fiscal Sustainability Program (FSP)." "The FSP builds on the Fiscal Balance Program measures and reform initiatives implemented during the past five years, which increased non-oil revenue to more than 18 percent of non-oil GDP in 2020 from less than 10 percent in 2015 and reduced non-interest expenditure to 53 percent of non-oil GDP from 56 percent in 2015. The FSP aims to further enhance fiscal discipline, improve the effectiveness of public finance management, and support the rebuilding of fiscal buffers." according to the report. It added that "consequently, the governments debt burden will decline below 29 percent of GDP at the end of this year and further to around 25 percent of GDP by 2025 from 32.5 percent of GDP in 2020." The agency estimated that the size of public debt to GDP in the coming years would fall between 25 percent and 30 percent, surpassing its estimations for comparable countries with the same credit rating of 35 - 40 percent. "Moodys expects that overall spending will likely decline by around 6 percent this year, whereas the draft 2022 budget targets another 6 percent reduction next year," it noted. In addition, the report commended the Kingdom’s strength in the oil market displayed in its capacity of producing oil at the lowest costs in comparison with other exporting countries. Such advantage supports the Kingdoms economic resilience in the environment of low oil prices.