Moody?s upgrades Indonesia on improved finances

Friday, May 19, 2006

Global rating agency Moody?s Investors Service raised Indonesia?s rating to B1 from B2 on Friday, commending an improvement in public finance and a record of sound fiscal management in the past few years.

Government debt as a percent of gross domestic product had fallen to 50 percent in end-2005, Moody?s said, adding that it expected further declines.

?Although somewhat more than half the debt is in foreign currency, the great majority of this debt is owed to official creditors, making the country less subject to adverse changes in external market conditions,? the agency said in a statement.

It said Indonesia was in a better position in this regard than most countries rated B1.

Moody?s said any further upgrades would depend on the maintenance of sound government finances, improvements in the investment climate, and increased inflow of foreign direct investment.

Source: Financial Times (link opens in a new window)