LONDON, April 19 (Reuters) - Cambodia received a B+ rating for foreign- and local-currency debt from Standard & Poor's on Thursday, with the ratings agency saying the Asian country needs continued help from donors to maintain solvency.
The rating is four notches below investment-grade status. S&P said the rating takes into account Cambodia's relatively high public and external debt, some bilateral portions of which are in arrears.
"Cambodia requires continued donor assistance to maintain domestic and external solvency, owing primarily to its severely constrained revenue-generating capacity, which also renders debt servicing ability vulnerable to negative shocks," the agency said.
S&P analyst Agost Benard said Cambodia's general government revenue to gross domestic product (GDP) ratio of 12 percent was the lowest in the Asia-Pacific region.
However, Cambodia has a track record of strong economic growth -- with real GDP growth averaging 9 percent over the past six years -- and a prudent macroeconomic policy mix, S&P said.
The ratings outlook is stable.
The rating is four notches below investment-grade status. S&P said the rating takes into account Cambodia's relatively high public and external debt, some bilateral portions of which are in arrears.
"Cambodia requires continued donor assistance to maintain domestic and external solvency, owing primarily to its severely constrained revenue-generating capacity, which also renders debt servicing ability vulnerable to negative shocks," the agency said.
S&P analyst Agost Benard said Cambodia's general government revenue to gross domestic product (GDP) ratio of 12 percent was the lowest in the Asia-Pacific region.
However, Cambodia has a track record of strong economic growth -- with real GDP growth averaging 9 percent over the past six years -- and a prudent macroeconomic policy mix, S&P said.
The ratings outlook is stable.
4 comments:
Duh! Cambodia is stable??? What do you mean??? Cambodia is racing toward instability base on some short-sight economic policy!!!
It seem that Cambodian government under AH HUN SEN dictator leadership keep on spending and keep on borrowing without much progress to show for!!!I don't see any heavy, medium, and light industry to promote any kind of production or manufacture! I don't see Cambodia is producing anything beside textile.
The whole country of Cambodia is a consumer not a producer!!!!
Could anybody explains me more about the rating? what is the best rated and what is the worth rated?
Thanks in advance
These ratings by S&P and others are globally very important in questions of raising money for any investments - if you are a company or a state. They indicate under what conditions you could get money from the market. The better your ranking, it is easier and much cheaper to get credit lines. "Stable" in the article means more or less, that they expect no important change of the general situation in the nearer future: They don't think that the general conditions will get worser, but they do not see important improvements. In their terms it is neutral.
Have a look at wikipedia for rating details:
http://en.wikipedia.org/wiki/Standard_and_poors
Thanks 1:36 pm for the explanation. I will see some detail on wikipedia as you suggest...
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