By Nigar Abbasova
Moody’s Investors Service, an international ratings agency, has confirmed Azerbaijan’s long-term issuer and senior unsecured debt ratings at Ba1 and assigned a negative outlook.
The country’s rating was changed in February 2016 while the outlook on it was changed to “negative” in April 2016.
The agency downgraded the government bond and issuer ratings of the country to Ba1 from Baa3.
The impact of the fall in oil prices, rising pressures on the financial system of the country and loss of confidence in the national currency (the manat) are considered to be the key drivers for the downgrade to Ba1.
Moody's projects real GDP to contract by 0.7% in 2016 as compared to a previously forecasted expansion of 1.7 percent while the growth of around 1 percent is forecasted for 2017.
Earlier, Fitch Ratings also approved the long-term issuer default rating (IDR) of Azerbaijan at “BB+” with the forecast “negative”, and forecasted the short-term IDR both in foreign and local currencies at “B”.
Finance Minister Samir Sharifov said recently that the country will gradually restore its sovereign rating due to the stabilization of the economic situation, increase of the volume of export earnings as well as positive results of reforms which are implemented in the country.
Sharifov stressed that sovereign rating downgrade by the international rating agencies has also concerned other countries which are oriented in the export of raw-materials mentioning that the process in natural.
Nigar Abbasova is AzerNews’ staff journalist, follow her on Twitter: @nigyar_abbasova
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