5 Jul 2016

Fiji credit rating steadies post-cyclone Winston

11:18 am on 5 July 2016

The credit ratings agency, Standard and Poors, has affirmed its 'B-plus' long term, and 'B' short-term rating for Fiji.

Fiji currency

Fiji currency Photo: Supplied

It said the country's economic outlook was stable, with Cyclone Winston causing little impact.

Standard and Poors said the government's falling interest costs and its sound external position supported the affirmation, and the effect of Cyclone Winston on the economy was expected to be minimal.

However, it said the credit standing was constrained by Fiji's weak institutional settings, limited monetary policy flexibility, a high rate of borrowing, and the likely weakening of the government's fiscal position.

There was a possibility that the rating could be downgraded if Winston's economic impact turned out to be worse than forecast, or if political instability resumed.

While an upgrade could happen if economic growth remained strong and the government reduced its foreign exchange restrictions.

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