Japanese credit rating agency JCR has affirmed its BBB rating on Bulgaria's foreign currency long-term senior debts and its BBB+ rating on the local currency long-term senior debts. The outlook of the ratings has been kept negative.

"The ratings are based on Bulgaria's solid fiscal structure underpinned by a continued fiscal surplus and the substantial reduction of the government debt, its maintenance of the solid currency board arrangement through collaboration between the government and the Bulgarian National Bank (BNB), and its expanding production capacity rendered by robust investments amid massive inflows of foreign direct investment (FDI) and EU subsidies," the agency said in a statement.

It points out that the ratings remain constrained by the country's large current account deficit despite its rapid improvement in the recent months, a sizable foreign debt in the private sector and the fact that its industrial transformation still remains at a primary stage.

JCR expects the government of the center-right Citizens for European Development of Bulgaria (GERB) party to pursue more credible policies than its predecessors.

"Nonetheless, the external finance of country's sizable foreign debts in the private sector remains vulnerable to the ongoing global economic and financial turmoil," JCR said.

Its forecast is that the economy will suffer steep setback in 2009 but may retain strong medium-term growth potential.

We need your support so Novinite.com can keep delivering news and information about Bulgaria! Thank you!