Serbia's Outlook Raised to Positive by Moody’s on Reform Programby
Moody's cites government's commitment to economic reforms
The country's sovereign credit rating was left at B1
The outlook on Serbia’s junk credit rating was raised to positive by Moody’s Investors Service, which cited the country’s implementation of structural and fiscal reforms to help ease its debt burden.
Moody’s left the Balkan nation’s sovereign debt rating at B1, four steps short of investment grade and on par with Vietnam and Kenya. Fitch Ratings has Serbia at the same level, while Standard & Poor’s rates it one grade higher. Both companies raised their outlooks to positive from stable in December and January.
“Moody’s decision to assign a positive outlook to Serbia’s B1 rating reflects the authorities’ commitment to addressing the deterioration in the sovereign’s debt burden,” analysts Marco Zaninelli and Yves Lemay said Friday in a statement. The initiatives include the implementation of structural reforms as well as a fiscal consolidation program, they said.
Growth in the the biggest ex-Yugoslav republic’s economy is set to more than double to 1.8 percent this year. Prime Minister Aleksandar Vucic, who’s seeking a new term at snap elections next month, wants to narrow Serbia’s budget deficit and halt increases in public debt. Planned measures include eliminating thousands of jobs in public administration, schools, hospitals, police and state-run companies, part of a three-year austerity program agreed on with the International Monetary Fund.