Standard & Poor’s Ratings Services, Wednesday, lowered Tunisia’s long- and short-term foreign currency sovereign credit ratings to ‘BB/B’ from ‘BBB-/A-3’.
It also lowered the long- and short-term local currency ratings to ‘BB/B’ from ‘BBB/A-3’. The outlook is stable.
S&P also said it cut long- and short-term foreign currency issuer credit ratings on the Central Bank of Tunisia to ‘BB/B from ‘BBB-/A-3’ and downgraded the long- and short-term local currency ratings to ‘BB/B from ‘BBB/A-3’. The outlook is stable.
“For the Republic of Tunisia, economic, fiscal, and external indicators–both in reported data and in our revised forecasts–are now weaker than we previously anticipated,” S&P indicated.
It also believed that despite overall stability and consensus since the removal of former President Ben Ali in early 2011, medium-term policy uncertainties will persist, at least until Tunisia adopts a new constitution and elects a government. It does not expect this before mid-2013.
The stable outlook reflects the ratings agency’s expectation that, despite uncertainties, the ongoing transition to the 2013 elections will occur without major political conflict. The outlook also reflects S&P’s expectation that Tunisia’s fiscal and external balances will gradually recover over the next few years.