DUBAI — The outlook for non-financial corporates in the GCC is stable, Moody’s Investors Service said on Dec. 13 in its annual corporate outlook on the regions.

The report said the drivers of the stable outlook on GCC companies are the generally supportive oil prices, resulting in narrowing fiscal deficits, coupled with governments’ ongoing commitment towards public spending and their supportive stance towards government-related issuers.

Conversely, the outlook for non-financial corporates in both Turkey and South Africa remains negative for the coming 12 to 18 months.

“While the outlooks for companies in Turkey, South Africa and GCC remain unchanged versus last year, the diverging regional trends will continue into 2019,” said Rehan Akbar, a Moody’s Vice President.

The key drivers of the negative outlooks are:

• For Turkish companies, high foreign exchange volatility, tighter financial conditions, and the limited clarity on policy direction. The impact of these factors are compounded by Moody’s expectation of economic contraction in 2019.

• For South African companies, the country’s persistently low growth, and continued political and policy uncertainty, which has depressed business and consumer demand. — SG