Fitch Ratings assigned credit ratings to Turkmenistan at «B» and «B + stable»
15:20 24.08.2021 5309
The international rating agency «Fitch Ratings» has assigned Turkmenistan a short-term rating at «B» and a long-term rating at «B+ stable», the website of the Ministry of Foreign Affairs of Turkmenistan reports.
The Foreign Ministry notes that the ratings assigned to Turkmenistan testify to the sustainable development of the economy of our country.
«The assignment of these ratings to Turkmenistan will contribute to the further intensification of the country's foreign economic activity and the expansion of its trade and economic ties with other states,» the Foreign Ministry said.
The ratings of Turkmenistan take into account the good state and external balance sheets, which are supported by large gas reserves, according to the commentary on the website of the agency «Fitch Ratings».
The Stable Outlook reflects Fitch's expectation that energy prices and macroeconomic policies will be in line with a broadly balanced budget and external account.
The doubling of gas production between 2009 and 2015 supported a state-run economic model and allowed the authorities to create budgetary and external buffers, the agency said in a commentary.
According to the State Statistics Committee, real GDP growth ranged from 6.2% to 6.5% between 2015 and 2019 and declined to 5.9% in 2020. Growth last year was negatively impacted by the impact of the COVID-19 pandemic on gas sales to China and transportation.
Over the five years to 2020, natural gas exports averaged 60% of total export earnings, while oil and petrochemicals took 27%. In 2020, exports fell 32% due to lower volumes and gas prices, the agency comments.
Fitch expects the current account to improve on the back of higher export prices and energy volumes. Supplies to China and growth in exports to Russia (which resumed in 2019) will support gas exports in 2021. Increasing the production of petrochemicals and other petroleum products (as production ramps up at new refineries) will also increase hydrocarbon exports, Fitch says.
At the government meeting last Friday, President Gurbanguly Berdimuhamedov noted that the international ratings assigned to Turkmenistan by the Fitch Ratings Agency would help improve the international financial status of our state, increase the volume of investments attracted to the country and simplify credit conditions, further develop foreign economic activity, and it would increase the prestige of Turkmenistan.
The President also stressed the importance of continuing to consistently carry out the necessary work with the International Agency to obtain ratings and increase them on a periodic basis.
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