American risk rating firm Standard and Poor’s announced, this Thursday, May 5, that it maintains stable the credit notes of Colombia for him sovereign credit long-term in foreign currency BB+ and in local currency with the note BBB-.
(See: What did the IMF take into account to deliver US$9.8 billion to Colombia?).
According to the qualifier, the note was maintained after observing a “sustained economic growth”, which they believe that “help reduce fiscal deficits” and will stabilize the net debt of the General Government at around 60% of the GDP.
At the same time, the entity also adds that they expect a “broad continuity” of the economic, fiscal, monetary policies and growth-friendlyafter a presidential transition” in August this year.
In the case of short-term credit, the entity also maintained the ratings of B. for foreign currency and A-3 short-term in local currency.
(See: Reasons why the industrial sector accelerated its growth).
However, the agency warned that it could lower the rating in the event of three scenarios. The first of these is to achievelower-than-expected growth” or if the government’s political support for sustaining growth prospects is diminished.
Also, says the qualifier, it could lower the grade if deteriorate large deficits current account (CAD), which would bring a higher external debt and a “unexpected deterioration” in external financing.
(See: Banco de la República raised interest rates to 6%).
Now, the US firm says it could raise grades in 24 months if economic growth is consistent and “significantly” faster than expected, while strengthening structural measures that reduce the fiscal deficit, the debt load and strengthen the Public finances.
It could also support a larger and more diverse export sector that allows the country “reduce external vulnerability and strengthen economic resilience”.
(See: Colombia would be the fourth country with the highest economic growth in Latam).
BRIEFCASE
