Summary Earlier, Moody's had put Pakistan's foreign bonds in B3 category
ISLAMABAD (Dunya News) – Standard and Poor’s (S&P), international rating agency on Monday has stated that Pakistan’s economy can better if budget deficit decreases and foreign investment rises above what is expected.
S&P stated that Pakistan’s economy is getting better in light of foreign financial payments. The agency stated that economic growth is likely to maintain at 4.5 percent from 2015 to 2018 due to remittances, pace in construction sector and improved supply of gas and power.
Moreover, the ratings agency stated that inflation is likely to limit at five percent due to cut in crude oil and crops prices in international market. S&P has maintained Pakistan’s rating at B and B- with a positive outlook.
Earlier, Moody’s had issued rating of Pakistan’s foreign bonds while mentioning slow-pace of economic growth of the country.
Moody’s had put Pakistan’s foreign bonds in B3 category. However, Moody’s said that China-Pakistan Economic Corridor (CPEC) would boost growth of economy and increase foreign investments. Furthermore, the project is likely to better transport and energy sectors.
The global currency rating agency Moody’s has assigned a definitive B3 rating to Pakistan’s global bond offering, terming the outlook stable.
The stable B3 rating is indicative of improvement in Pakistan’s economy. The agency is of the view that the China-Pakistan Economic Corridor (CPEC) project will bolster trade and economic activity especially that linked to transport and energy sectors and will ultimately result in economic improvement.
“Pakistan s B3 issuer rating reflects moderate economic strength with a supply-constrained economy that has been resistant to structural change. Although the scale of the economy is relatively large, globally, Pakistan s per-capita income level is relatively very low. Implementation of the China-Pakistan Economic Corridor, will over time, bolster growth through investment in transportation and power generation infrastructure,” Moody’s said in a press release.
It pointed out lack of extension of taxpayers’ circle and savings as weak points and indicated that lack of cooperation between institutions can hinder continuance of policies.
