S&P affirms BBB+ for Thailand



BANGKOK: -- American credit rating agency, Standard & Poor's Ratings Services, has affirmed its ratings on Thailand with stable outlook.

It assigned its BBB+ long-term and A-2 short-term foreign currency sovereign credit ratings for Thailand, and also gave A- long-term and A-2 short-term local currency ratings.

The outlook for long-term ratings is stable.

In a statement issued this week, the rating agency said Thailand’s strong external balance sheet and liquidity, a modest level of government debt, and a history of effective monetary and fiscal policies support the rating.

These strengths are weighed against the economy’s relatively low-income level and the country’s continued political uncertainty,” the rating agency said in a statement.

But S&P also warned of a rating risk “if political and institutional stability deteriorates beyond what we have observed in the past seven years”.

“We may also lower the ratings if the country’s fiscal or economic indicators weaken significantly,” it said.

The statement went on saying if leaders across Thailand’s political spectrum achieve greater harmony, it believed economic growth prospects would improve.

Source: http://englishnews.thaipbs.or.th/sp-affirms-bbb-thailand


-- Thai PBS 2014-12-19

"... a modest level of government debt ..."

This reflects a failed economic strategy if there is to be 3.5-4.5% GDP growth predicted by Gen. Prayuth for 2015. The government needs to make substantial infrastructure investment, ie., through borrowing, immediately. So the BBB+ rating reflects a status quo for an economy that will simply stagnate slightly higher than the 2% rate of inflation.

Ooops - plenty of scope for downward revisions if the economic indicators start to falter. One can only cook the books so long before they get burnt as the West has seen - not that they have stopped cooking them of course.