Bahrain Mirror- Reuters: S&P Global Ratings on Friday revised Bahrain's outlook to 'negative' from 'stable', citing the country's pace and ability to service its finances and external debt.

The oil-producing Gulf state's economy contracted by 5.4% last year, the International Monetary Fund estimated, as the pandemic hurt vital sectors such as energy and tourism.

"The tentative pace of fiscal reform is insufficient to stabilize Bahrain's debt to GDP over the next few years, despite higher oil prices compared with 2020", the rating agency said in a statement.

Bahrain expects to post a deficit of 1.2 billion dinars ($3.20 billion) in 2021, state news agency BNA said, citing the finance ministry's statement in March. 

"... the delicate political and social environment will continue to constrain the government's fiscal reform efforts this year and beyond," S&P said.

The rating agency expects Bahrain's economy to rebound in 2021, with real GDP expanding by 2.7%, citing an increase in oil prices and regional economic activity.

The agency affirmed Bahrain's rating at 'B+/B'.

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