US ratings agency Standard & Poor’s (S&P) has reaffirmed Oman’s long-term credit rating of A, with a stable outlook.

The country’s short-term local and foreign currency rating of A-1 was also confirmed.

The decision not to downgrade the country reflects the country’s stabilising political environment, following the unrest seen in 2011. The agency also forecasts that the government’s fiscal performance will remain favourable, and allow for anticipated increases in social spending.

However, the rating could be downgraded if the political situation worsens, fiscal performance suffers or there is a sharp decline in oil prices.

S&P also sees the country’s economic growth constrained by the country’s dependence on hydrocarbons, as well as a very young population. Approximately 60 per cent of the population is under 25. Yet Oman does benefit from strong alliances with international powers, as well as its relatively neutral position in the GCC region.

During the height of the political unrest in 2011, S&P did place Oman’s A ratings on review for a possible downgrade.