Credit rating of Belarus downgraded to “negative”

The International Standard & Poor's rating agency (S&P) has downgraded the forecast of the credit rating of Belarus from “stable” to “negative”.

“Changing the forecast on Belarus’ rating reflects negative influence of the world economic and financial sphere on the country’s economy,” the press-release writes.

“Considerable deterioration of trade conditions against the background of lessening demand from key exporters of services would increase pressure on the current account balance while access to external financing is limited, accompanied by limited defence and low external liquidity,” Telergaf quotes the rating agency report with the reference to AFN.

According to experts of S&P, in 2008 the deficit of current account would be about 3.6 billion dollars, or 7% of GDP. The agency forecasts decrease of export demand, including the demand from the key CIS partners. Trade conditions in the country are deteriorating because in 2009 the new stage of cutting Russian gas subsidies will start.

“Stable growth of the level of currency reserves, and at the same time measures taken for reinforcing external competitiveness and decreasing dependence of the Belarusian economy on import would be the conditions for reassigning the stable credit rating again. And on the contrary, considerable growth of the current account deficit and deterioration of external liquidity could follow in rating’s dropping,” S&P added.

The agency has affirmed Belarus' 'B+' foreign currency, 'BB' local currency long-term and 'B' short-term sovereign credit rating.