Moody’s, a little less optimistic on the note of the Tunisia – Boursorama

The rating agency Moody’s has warned that the grade given to sovereign debt of Tunisia could be lowered in the medium term because of the deterioration in public finances.

While confirming the “Va3″ of the country, a rating assigned to issuers that can meet their commitments, but also with speculative characteristics, Moody’s came out with a perspective that is “negative” against “stable” in the past, according to a statement released Tuesday night.

To justify this decision, the agency puts it, “the delays continuing towards fiscal consolidation, which leads to the worsening of the budget deficit and a path to the level of the debt-to-GDP ratio that are farther away from the average of the countries placed in the same category”.

at the same time, vulnerabilities to external increase, fueled by the persistent imbalance of the balance of trade and by an increase in the gross foreign debt,” says Moody s.

The unity government took office at the end of August –after his predecessor was found in failure on the economy– has recently adopted a draft of finance law (PLF) in 2017, which calls for a significant recovery of growth (2.5 per cent).

But it has also revised up the forecast budget deficit for 2016 and 2017, respectively, 5.7% and 5.4% of GDP, recalls Moody s.

And, “it is also intended that the government’s debt reaches 63,2% of GDP at end-2016 compared to 54.9% in 2015″, adds the agency.

In accordance with it: a more modest growth than expected to 1.5% from 2.5% originally anticipated, a provision of income to the lower of 2% and an effect linked to the depreciation of the currency, accounting for about 4.5 percentage points of GDP.

The government’s debt would exceed 65% of GDP in 2017-2018, warns Moody s.

Tunisia, however, continue to enjoy a certain “solidity of its institutions when compared to other countries placed in the same category” and “current support of international institutions”, thus justifying the maintenance of its short-term rating, ” adds the agency.

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