S&P affirms RI's long term rating<\/p>\n
SYDNEY (Reuter): Standard and Poors Corp (S&P) said yesterday
\nit had affirmed Indonesia's long term foreign currency rating at
\nBBB and assigned its A-plus local currency rating.<\/p>\n
S&P said the outlook for the ratings was stable.<\/p>\n
S&P said the ratings are supported by Indonesia's long
\nstanding commitment to prudent fiscal management.<\/p>\n
Savings and investment rates of over 30 percent of GDP,
\namongst the highest in the BBB category, should substain GDP
\ngrowth averaging eight percent annually, it said.<\/p>\n
\"The higher rupiah credit rating standing is further supported
\nby the central government's insignificant rupiah debt burden and
\nBank Indonesia's long track record of containing inflation to
\nsingle-digit levels,\" S&P said.<\/p>\n
S&P said Indonesia's creditworthiness is constrained by
\nsubstantial infrastructure development needs, which, in the
\ncontext of low per capita income compared to similarly rated
\nsovereigns, will pressure government finances medium term.<\/p>\n
It added that creditworthiness is also constrained by the risk
\nthat the eventual political transition may slow, though not
\nderail, the ongoing microeconomic reform process and the uneven
\ntrend toward improving transparency.<\/p>\n
\"President Soeharto is likely to be re-elected in 1998, but
\nhis eventual exit from politics will test confidence and
\nchallenge his successors to maintain support for economic policy
\northodoxy and further structural reform,\" S&P said.<\/p>\n
\"Indonesia's consenus-based political culture, the widely
\nshared benefits of economic development, and a technocratic
\nleadship augur well for economic policy stability during the
\ntransition and beyond,\" the ratings agency said.<\/p>\n
Public finances should strengthen as ongoing tax reforms
\nbolster non-oil revenues and would benefit too from additional
\nprivatisation, it said.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/sp-affirms-ris-long-term-rating-1447893297",
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"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
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