Fitch: Thailand Downgraded To Negative Due To Political Crisis

Fitch: Thailand downgraded to 'negative' due to political crisis

BANGKOK: -- Thailand's political crisis has forced the Fitch Ratings agency to cut its outlook for the kingdom from 'stable' to 'negative', a senior Thai Ministry of Finance official said on Wednesday.

Pongpanu Svetarundra, director-general of the Public Debt Management Office, said the agency had affirmed Thailand's long-term foreign and local currency ratings at BBB+ and A respectively.

Thailand's short-term foreign ratings were affirmed at F2 with the country ceiling at A-. It projected that Thailand's gross domestic product in 2009 would decline to 0.9 per cent, its lowest level since 1997 when financial crisis hit this country.

The agency's ratings downgrade was made in response to the ongoing political chaos in Thailand and the absence of credible political leadership in the country. Economic policy was either neglected or ineffective at a time when policy stimuli is required to address and effect a sharp economic correction, according to Fitch Ratings.

Fitch said it is still unknown when the political situation in Thailand would return to normal.

Fitch Ratings' reflected a similar outlook change by Standard and Poor's on Monday.

S&P cited rising political risk in Thailand on cutting the country's credit rating outlook to negative from stable while maintaining the country's foreign currency rating at BBB+/A-2 and local currency at A/A-1.

-- TNA 2008-12-03