Moody's lowers Tunisia credit rating

In terms of Tunisia's debt payments, Moody's said risks were limited.

Moody's lowers Tunisia credit rating

Moody's Investors Service lowered its credit rating of Tunisia to Baa3 from Baa2 on Wednesday and said it may cut it further because of instability and unrest following the ousting of strongman Zine al-Abidine Ben Ali.

"The current uncertainties about the economic and political consequences of the collapse of Tunisia's previous political regime are the main drivers for the decision to downgrade the government's bond ratings by one notch and assign a negative outlook," said Aurelien Mali, Moody's lead sovereign analyst for Tunisia.

"Moody's will closely monitor Tunisia's political risk and stability over the next few months, as a further outburst of violence and disorder could exert added negative pressure on the economy," he said.

Tunisia's caretaker prime minister aims to gather his national unity cabinet for a first meeting on Wednesday, but he already faces revolt from opposition nominees demanding he fire more of Ben Ali's allies.

Within a day of Prime Minister Mohamed Ghannouchi appointing several opponents of the former president, four of them quit his new government, saying street protesters who triggered the upheaval were disappointed at how many of the old guard, including Ghannouchi himself, were still in power.

In terms of Tunisia's debt payments, Moody's said risks were limited.

There are only two international government-issued bonds, due in April and September of 2011, amounting to a total of $775 million it said and the central bank still holds $1.6 billion following the partial privatisation of Tunisia Telecom, giving some room for manoeuvre.

"More importantly, Moody's expects the country to receive some form of external assistance from abroad, if needed," the ratings agency said.

Reuters

Last Mod: 19 Ocak 2011, 10:29
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