DUBAI- Moody's assigned the United Arab Emirates a provisional Aa2 rating on Thursday for its new global medium-term note programme, which will allow the federation to raise debt as a whole for the first time.

The rating is in line with the long-term issuer rating of the UAE, a federation of seven emirates, some of which have borrowed individually previously.

It is also the same rating as for Abu Dhabi, the country's capital, largest emirate and major oil producer.

Notes issued under the programme may be denominated in various currencies and have different maturities, the ratings agency said. Proceeds will be used for general budgetary purposes as well as to finance infrastructure projects and investments by the Emirates Investment Authority.

"The UAE's Aa2 rating is supported by the country's very high level of per capita income and very large hydrocarbon endowment, as well as its lengthening track record of domestic political stability coupled with strong international relations," Moody's said.

"While revenue is highly decentralised, with individual emirates collecting the bulk of general government revenue, Moody's assumes that the federal government will receive full backing from the government of Abu Dhabi and the latter's strong balance sheet and substantial net creditor position," it said.

Abu Dhabi, which has vast oil wealth and one of the world's biggest sovereign wealth funds, and the UAE central bank bailed out neighbouring emirate Dubai with a $20 billion package in 2009 in the aftermath of the financial crisis.

"At the same time, this fiscal decentralisation also reduces the risk of contingent liabilities that may arise from government-related entities of the individual emirates," Moody's said.

Moody's said the UAE's environmental, social and governance (ESG) impact score was moderately negative, saying its environmental risk is highly negative, social risk is neutral to low and governance risk is positive.

(Reporting by Yousef Saba; Editing by David Clarke) ((Yousef.Saba@thomsonreuters.com; +971562166204; Reuters Messaging: https://twitter.com/YousefSaba))