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Armenia Gets Another Western Credit Rating
Radio Liberty, Czech Republic
July 25, 2006
By Atom Markarian
Moody's Investors Service, a leading Western risk assessment company,
has assigned its first-ever credit rating to Armenia in what senior
officials in Yerevan described on Tuesday as another milestone in
the country's transition to the free market.
Moody's ratings are widely used by investors around the world for
analyzing risks associated with lending to foreign countries and
companies. The BA2 grade given to Armenia signifies a medium level
of creditworthiness.
The chairman of the Armenian Central, Tigran Sarkisian, and Finance
Minister Vartan Khachatrian stressed the fact that Moody's rated
Armenia more highly than neighboring Georgia and Turkey and put it on
a par with neighboring Azerbaijan. They said the rating will allow
the Armenian government to sell bonds in international financial
markets and will make it easier for local private firms to attract
foreign investments and loans.
Khachatrian made it clear, however, that Yerevan has no intention to
issue so-called Euro-bonds in the near future. "The government does not
plan to issue Euro-bonds and get into greater debt in the coming years
because we think we can achieve our current objectives with internal
resources and loans received from international organizations,"
he told a joint news conference with Sarkisian.
Much of Armenia's budget deficits have for years been covered by
low-interest loans disbursed by the World Bank and financial grants
provided by Western governments. Proceeds from domestic sales of
government bonds and treasury bills still pale in comparison with
donor funding.
Moody's rating is slightly higher than the one assigned to Armenia
by another famous rating agency, Fitch, in early June. The latter's
"sovereign credit rating" of BB- indicated a relatively high risk of
doing business. While praising the country's "impressive economic
performance," Fitch said Armenian economy remains "vulnerable to
shocks" due to its high degree of dollarization, underdeveloped
financial services and the unresolved Nagorno-Karabakh conflict.
A statement by the Armenian Central Bank quoted the Moody's
vice-chairman, Sarah Bertin, as citing the same problems hampering
Armenia's economic development. She said at the same time that Moody's
analysts believe that a renewed war in Karabakh is unlikely in the
coming years.
Radio Liberty, Czech Republic
July 25, 2006
By Atom Markarian
Moody's Investors Service, a leading Western risk assessment company,
has assigned its first-ever credit rating to Armenia in what senior
officials in Yerevan described on Tuesday as another milestone in
the country's transition to the free market.
Moody's ratings are widely used by investors around the world for
analyzing risks associated with lending to foreign countries and
companies. The BA2 grade given to Armenia signifies a medium level
of creditworthiness.
The chairman of the Armenian Central, Tigran Sarkisian, and Finance
Minister Vartan Khachatrian stressed the fact that Moody's rated
Armenia more highly than neighboring Georgia and Turkey and put it on
a par with neighboring Azerbaijan. They said the rating will allow
the Armenian government to sell bonds in international financial
markets and will make it easier for local private firms to attract
foreign investments and loans.
Khachatrian made it clear, however, that Yerevan has no intention to
issue so-called Euro-bonds in the near future. "The government does not
plan to issue Euro-bonds and get into greater debt in the coming years
because we think we can achieve our current objectives with internal
resources and loans received from international organizations,"
he told a joint news conference with Sarkisian.
Much of Armenia's budget deficits have for years been covered by
low-interest loans disbursed by the World Bank and financial grants
provided by Western governments. Proceeds from domestic sales of
government bonds and treasury bills still pale in comparison with
donor funding.
Moody's rating is slightly higher than the one assigned to Armenia
by another famous rating agency, Fitch, in early June. The latter's
"sovereign credit rating" of BB- indicated a relatively high risk of
doing business. While praising the country's "impressive economic
performance," Fitch said Armenian economy remains "vulnerable to
shocks" due to its high degree of dollarization, underdeveloped
financial services and the unresolved Nagorno-Karabakh conflict.
A statement by the Armenian Central Bank quoted the Moody's
vice-chairman, Sarah Bertin, as citing the same problems hampering
Armenia's economic development. She said at the same time that Moody's
analysts believe that a renewed war in Karabakh is unlikely in the
coming years.