Moody’s Investors has maintained Tunisia’s investment grade “Baa3,” “a rating that staves off the risk of Tunisia’s payment default in a foreseeable future, but assigns a negative outlook to the country,” according to Mr. Aurélien Mali, lead analyst at Moody’s.
“The country has managed in spite of the difficulties faced in 2012, especially recession in Europe, to make a recovery and get out of the recession,” the analyst said.
He added that “Tunisia has also managed to mobilize enough funding for economic recovery while ensuring the sustainability of deficit and external debt.”
The country was able to control the overall balances with “a public debt ratio/GDP of 46% compared to a rate of 68.5% for a country with the same rating such as Spain,” he said.
In addition, “the international community will certainly support Tunisia until the next elections because it does not want to see the country fail at a time when it is trying to embrace democracy,” the analyst reassured.
According to him, “Tunisia’s payment default is discarded in the foreseeable future, thanks in particular, to the current international support.”
“Tunisia’s sovereign bond yields in Euros, maturing in 2020, declined by 51 basic points (bp) in 2012, i.e. 0.51%, to stand at 5.19%, and were traded at 5.18% on January 4,” he indicated as an example.
However, the rating assigned a negative outlook to Tunisia.
“A negative pressure on rating could occur, if the country fails to complete transition in time and if the authorities cannot overcome challenges to achieve the goal of reducing deficit and avoiding overspending,” the analyst noted.
