The agency highlights the country's macroeconomic stability, while noting a slight deterioration of fiscal indicators in recent years.
From a press release issued by Moody's:
New York, October 25, 2016 -- Panama's Baa2 rating with a stable outlook reflects the country's strong economy and its broad macroeconomic stability, says Moody's Investors Service. This buoyant growth will help Panama's government reduce the nation's fiscal deficit over the coming years.
The ratings agency has reduced the rating for long-term sovereign debt from B + to B, arguing that political capacity to resolve the fiscal problem is shrinking.
From a press release by Standard & Poor´s:
Continued political stalemate in El Salvador has led to a deterioration of institutional and governance effectiveness, which has contributed to a weaker external profile, and a further erosion of the government's liquidity.
Standard & Poor's cites persistent difficulties in approving a fiscal reform in the short term, given the political fragmentation that exists in the Legislature.
Analyst Joydeep Mukherji said "... two previous governments have tried to make a fiscal reform and failed and that the government of Luis Guillermo Solis has had difficultyconvincing the Legislative Assembly ...".
Moody's warns of the risks faced by banks in Central America in the context of a rising trend in interest rates and dollarization of their loan portfolios.
From a report by Moody's:
Mexico, September 14, 2016 -- Banks in Central America face rising asset risks as interest rates look set to rise in the region, pushing up debt service costs for borrowers, according to a report from Moody's Investors Service.
Improving the sovereign debt rating from B3 to B2 reflects the significant reduction achieved in the fiscal deficit, which fell from 7.9% of GDP in 2013 to 3.1% in 2015.
The main factor which influenced the rating upgrade was consolidation of the fiscal discipline process enacted over the past two years and controls imposed on public institutions to achieve cost containment and improve tax administration.
Fitch Ratings has upgraded from negative to stable the outlook on the issuance of $650 million made in 2013, after another $575 million was successfully issued a few days ago.
In its statement, the rating agency noted that sanctions imposed by the Office for Assets Control of the United States Department of the Treasury on companies that are part of Grupo Waked Internacional (Wisa), for allegedly operating a money laundering scheme, will not have a material impact on the Tocumen's credit rating.
On May 4 Tocumen International Airport SA completed a primary bond issue worth $625 million at an interest rate of 5.375%, with the Notes maturing in May 2036.
An article on Capital.com.pa reports that "...Fitch Ratings, in a statement issued on April 22 2016 stated that it is 'hoping to qualify the issuance of guaranteed debt by Tocumen International Airport (Aitsa) in 2016 for $625 million with maturation in 2036 at BBB (exp) and AAA (pan) with a stable outlook '. At the same time Fitch affirmed the ratings maturing in 2023 at BBB, AAA (pan) and AAA (slv) and maintained the negative outlook for all three ratings on the 2013 issue."
Confirmation of the decline in the financial capacity of the construction company has strengthened arguments by those calling for the revision of their contracts and that the firm not be awarded others.
The sovereign rating B + with stable outlook is based on the "economic performance, low debt burden of the government, political stability and partnership between government and the private sector through dialogue".
Represents the Company RTS INTERNATIONAL, Inc. of Kansas Cyty, TX, USA, for the territory of Guatemala and Central America. RTS finance exports through Factoring system.
Operates in Guatemala
Phone: (502) 2369 5408 - (502) 5709 2986