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Ministry of Finance Press Release: Moody’s Affirms Montenegro’s Credit...
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Press Release: Moody’s Affirms Montenegro’s Credit Rating
Published on: Jun 7, 2012 • 6:38 PM Author: min fin
Credit Rating Agency Moody's has today affirmed the outlook on Montenegro’s ratings - Ba3 with stable outlook, which in addition to the last year’s outlook improvement from negative to stable, represents a great news and confirmation of Government’s efforts in maintaining the fiscal stability and overall economic environment.
The maintenance of Montenegro’s credit rating represents a tremendous success, especially having in mind downward momentum and the fact that the Credit Rating Agencies are downgrading the ratings of a vast number of European countries. In last 15 months, Moody's has downgraded the rating of total 13 countries, while the outlook for 4 countries was moved to “negative”, whereas only one country has improved the credit rating outlook.
Pursuant to Moody’s indicators, Montenegro achieved better results compared to other countries with the same rating outlook, being as follows: GDP per capita (this indicator is by 2,5 times higher in Montenegro compared to the average of the countries with the same rating), FDI share in GDP (this indicator is far higher), interest payments/revenues, etc.
Indicators based on which Montenegro has achieved weaker results compared to the countries with the same rating relate to the size of country, economic diversification and subsequently the high level of the current account deficit.
The Ministry of Finance will, also in the following period continue with the intensive communication with the representatives of Moody's, endeavoring in explaining a relatively high current account deficit, since in our opinion this issue is of crucial importance for improving the rating. Thus, our efforts will be focused on explaining the representatives of Moody's the objective reasons behind the high current account deficit, which is primarily reflected in import dependence. Namely, a dynamic economic growth, primarily the tourism and high FDI inevitably dictate the high imports, i.e. imports are the specific competitiveness indicator of our tourism sector and business environment, unlike the majority of other countries.
The outlook affirmation by this recognized international Credit Agencies represents an additional incentive for the Ministry of Finance to continue the implementation of policies directed to further stabilization of public finance and creating conditions for positive trends.
Here you can download Moody's Report in the English language Moody's Montenegro Sov Credit Report 2012.pdf
The maintenance of Montenegro’s credit rating represents a tremendous success, especially having in mind downward momentum and the fact that the Credit Rating Agencies are downgrading the ratings of a vast number of European countries. In last 15 months, Moody's has downgraded the rating of total 13 countries, while the outlook for 4 countries was moved to “negative”, whereas only one country has improved the credit rating outlook.
Pursuant to Moody’s indicators, Montenegro achieved better results compared to other countries with the same rating outlook, being as follows: GDP per capita (this indicator is by 2,5 times higher in Montenegro compared to the average of the countries with the same rating), FDI share in GDP (this indicator is far higher), interest payments/revenues, etc.
Indicators based on which Montenegro has achieved weaker results compared to the countries with the same rating relate to the size of country, economic diversification and subsequently the high level of the current account deficit.
The Ministry of Finance will, also in the following period continue with the intensive communication with the representatives of Moody's, endeavoring in explaining a relatively high current account deficit, since in our opinion this issue is of crucial importance for improving the rating. Thus, our efforts will be focused on explaining the representatives of Moody's the objective reasons behind the high current account deficit, which is primarily reflected in import dependence. Namely, a dynamic economic growth, primarily the tourism and high FDI inevitably dictate the high imports, i.e. imports are the specific competitiveness indicator of our tourism sector and business environment, unlike the majority of other countries.
The outlook affirmation by this recognized international Credit Agencies represents an additional incentive for the Ministry of Finance to continue the implementation of policies directed to further stabilization of public finance and creating conditions for positive trends.
Here you can download Moody's Report in the English language Moody's Montenegro Sov Credit Report 2012.pdf
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