Standard and Poor’s upgrades outlook on Azerbaijan’s investment climate
Ratings agency Standard and Poor’s on Monday raised its outlook on Azerbaijan from stable to positive in an optimistic appraisal of the country’s investment climate and budgetary policies.
11:31 / 15.12.2009 Ratings agency Standard and Poor’s on Monday raised its outlook on Azerbaijan from stable to positive in an optimistic appraisal of the country’s investment climate and budgetary policies.
The agency also affirmed its BB+ long-term and B short-term sovereign credit ratings for the oil-rich former Soviet republic.
"The revised outlook reflects our expectation that Azerbaijan’s public sector net asset and international investment position will strengthen, and that general government debt will remain moderate on the back of expected budget surpluses," Standard and Poor’s said in a statement.
The agency said the positive outlook reflected twin surpluses in Azerbaijan’s budget and current accounts and said a "rating upgrade to investment grade" could be possible within the next two years.
But it also warned that Azerbaijan’s ratings remain constrained by "regional geopolitical risks; political legal and economic governance challenges; and a relatively weak monetary policy framework."
A flare-up in tensions in Azerbaijan’s dispute with Armenia over the breakaway Nagorny Karabakh region would prevent a further upgrade and possibly lead to downward ratings pressure, the agency said.
Fuelled by energy sales, Azerbaijan has been a world leader in economic growth in recent years, though growth slowed to 10.8 percent last year amid dropping oil prices and the global financial crisis.
Ratings agencies such as Fitch, Standard and Poor’s and Moody’s assess the capacity of governments or companies to repay their debts. A stronger rating generally enables a borrower to acquire credit on favourable terms.Bu yazı ( 314 ) - dəfə oxunmuşdur
