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Belize Ratings Slip As Moody’s Points To Growing Debt Concerns

by Mike Godfrey, Tax-News.com, Washington

11 August 2004

International ratings agency Moody’s Investor Services last week announced its decision to downgrade Belize’s credit ratings amid concerns that the country’s mounting debt levels are becoming increasingly difficult to manage.

As a result, the firm cut Belize's country ceiling for bonds and notes to B2 from Ba3, lowered its foreign-currency country ceiling for bank deposits to B3 from B1 and reduced Foreign-currency bond ratings to B2 from Ba3.

According to Moody’s: "The debt buildup that led to the downgrade was largely a direct consequence of expansionary policies, although it also incorporates financing incurred to cover the reconstruction costs associated with various infrastructure projects."

The move comes soon after Standard & Poor’s announced a downgrade in Belize’s currency ratings last month, reflecting the challenges faced by the government in tightening its fiscal policy and introducing certain tax measures.

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