Estonian Rating Affirmed by Fitch on Recovery, Fiscal PrudenceOtt Ummelas
Estonia’s credit rating was affirmed by Fitch Ratings, which cited the Baltic country’s balanced economic recovery and strong public finances.
Fitch kept Estonia’s long-term government bond rating at A+, the fifth-highest investment grade, on par with Slovakia and Malta. The ratings company left the outlook at stable.
Estonia, which adopted the euro in 2011, has weathered Europe’s debt crisis as Swedish and Finnish demand for its electronics and wood products helped the economy recover from a 20 percent-slump in the wake of Lehman Brothers Holdings Inc.’s 2008 demise. The $22 billion economy expanded 3.2 percent last year, the European Union’s third-fastest pace, helped by exports and public construction spending.
“Euro membership has reduced the risk of a balance-of-payments crisis, simultaneously raising the profile of Estonia’s key rating attributes: fiscal conservatism, economic flexibility and underlying political and institutional strengths,” Fitch said today in an e-mailed statement from London.
Estonia had a preliminary budget deficit of 0.3 percent of gross domestic product last year after becoming the only euro-area member to run surpluses in 2010-2011. It had the lowest public debt among the region’s 17 members at the end of 2012 at 10.1 percent of GDP.