Improved Debt Rating for Panama

The rating agency Standard & Poor's has upgraded the Republic of Panama's credit rating in the medium and long term, from BBB- to BBB with a stable outlook.

Tuesday, July 3, 2012

A statement from the Ministry of Economy and Finance reads:
Standard & Poor's upgrades Panama’s credit rating

We expect GDP growth to remain strong in the short term, driven by high and diversified investment in the country. "

The rating agency Standard & Poor's today upgraded the credit rating for debt in the medium and long term of the Republic of Panama, from BBB-to BBB with a stable outlook.

This positive effect on Panama’s risk rating has been presented after the annual visit to the country during the month of May, where the information necessary needed to determine the country's ability to cope with its debt covenants was collected from the hand of government representatives, private business and opposition parties.

"The stable outlook supports our view that Panama’s growth projections and fiscal flexibility are strong to meet any challenges that might emerge in the transition to a less optimistic economic environment."

More on this topic

Moody's Upgrades Panama to Investment grade

June 2010

Moody's Investors Service on Wednesday upgraded Panama's sovereign ratings to investment grade of Baa3 from Ba1.

The change is based on a significant improvement in the country's fiscal and debt positions.

"The anticipated positive impact of fiscal policy initiatives on government accounts and prospects for sustained economic growth are at the core of the upgrade," said Alessandra Alecci, Moody's vice president and senior analyst. "The Panama Canal expansion and an ambitious infrastructure investment program are likely to support strong economic growth in the next few years, boding well for debt dynamics," added Alecci. The outlook is stable.

S&P Also Upgrades Panama to Investment Grade

May 2010

Standard & Poor’s rated Panama as investment grade; Fitch did the same two months ago.

The risk rating agency raised Panama's long-term foreign- and local-currency sovereign credit ratings to “BBB-” from “BB+”.

"The upgrade reflects our assessment that continued economic growth--combined with moderate fiscal deficits--should reduce the government's debt burden and maintain its financial profile comfortably in line with that of other sovereigns in the 'BBB' rating category," said S&P credit analyst Roberto Sifon-Arevalo. The outlook on Panama is stable.

Fitch Rating upgrades Panama to Investment Grade

March 2010

Panama has joined the privileged group of Latin American countries ranked as investment grade, which includes Brazil, Mexico, Chile and Peru.

Fitch Ratings has upgraded the Republic of Panama's long-term foreign currency and local currency Issuer Default Ratings (IDRs) to 'BBB-' from 'BB+'.

Fitch Downgrades Mexico to 'BBB'

November 2009

Fitch downgraded Mexico's Issuer Default Rating (IDR) from 'BBB+' to 'BBB' in foreign currency and from 'A-' to 'BBB+' in domestic currency.

Both ratings have a 'Stable' outlook. Additionally, the country's ceiling was reduced to 'A-' from 'A'.

Fitch downgraded Mexico's ratings because the country's fiscal situation has gotten worse with the financial crisis and a reduction in Mexican oil production.

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