Moody's Investors Service on Thursday assigned a B3 long-term issuer rating and a Not-Prime short-term issuer rating to the local and foreign-currency debt of the Republic of Moldova. The rating outlook is stable.
"The B3 rating reflects our assessment that Moldova's economic resiliency remains very low, despite having posted robust GDP growth before the global crisis," said Alexander Kockerbeck, a Vice President-Senior Credit Officer in Moody's Sovereign Risk Group.
"Going forward, growth is expected to be more subdued as workers' remittances and foreign direct investment have downshifted. On the other hand, lower capital inflows should reduce future macroeconomic volatility, which often follows periods of rapid credit growth."
In conjunction with the sovereign debt ratings, Moody's has also assigned a foreign currency bond ceiling of B2 and a foreign currency bank deposit ceiling of Caa1 to Moldova. Additionally, Moldova was assigned long-term local currency bond and bank deposit ceilings at Ba2.
Moody's expects that the Moldovan economy will recover in 2010 and 2011 from a sharp setback during the global crisis. It noted that Moldova's rating could come under downward pressure if the country faces fresh difficulties for its debt servicing capacity from adverse weather effects on the agricultural sector, workers' remittance inflows drop and/or a lack of privatization receipts or multilateral funding. (RTTNews)
