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"S&P" raises the rating for Albania, moving it to the "BB-" category for the first time

2024-03-23 12:41:00, Ekonomi CNA

"S&P" raises the rating for Albania, moving it to the

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The credit rating agency "Standard & Poors", (S&P), one of the three largest in the world, has increased the long-term rating of Albania's sovereign credit by one category, making it move to 'BB- ', from 'B+'.

"The assessment strengthens Albania's external positions and brings concrete benefits to the country's economy", declared today the Minister of Finance, Ervin Mete, explaining that "now the country will be perceived more positively by foreign investors to invest in Albania and this is expected translate into higher foreign investments, as well as easier conditions for Albania's borrowing in international markets. This improvement is also expected to be reflected in the local market, in lower financing costs for banks, businesses and individuals".

The agency has assessed that Albania has consistently demonstrated its ability to withstand shocks, including the 2019 earthquake, the COVID-19 pandemic and the indirect macroeconomic effects of the Russia-Ukraine war, noting the steady growth of economy in the last three years and the improvement of public finance parameters.

According to the Agency, the country's economic stability is partly attributed to the growth of tourism which "helped Albania to increase its exports of services by nearly 15% of GDP between 2019 and 2023, significantly strengthening its external position".

"S&P" has estimated the decline of public debt, from 74.5% of GDP in 2020 to 59.2% in 2023, according to the Albanian authorities, predicting that "the authorities will aim to maintain this measured approach to public finances, in in accordance with the Organic Budget Law, ensuring that Albania's public debt remains stable at an average of around 55% of GDP during the years 2024-2027".

The Albanian Minister of Finance said in his statement that "this assessment of 'S&P' comes six months after the international agency revised Albania's perspective upward from stable to positive", adding that "macroeconomic indicators have improved significantly, unemployment is at the levels historical lows, inflation has returned to the target ahead of expectations, the external position has improved thanks to the very good performance of the tourism sector, foreign direct investments have reached the highest historical levels"./VOA