- Lebanon is committed to economic reforms and will overcome its crisis, the finance minister said on Friday after Fitch downgraded the country’s credit rating to CCC while S&P kept it at B-/B.
Lebanon is grappling with one of the world’s heaviest public debt burdens at 150% of GDP and years of low economic growth. Government finances, riddled with corruption and waste, are strained by a bloated public sector, debt-servicing costs and subsidising the state-power producer. Fitch said on Friday its downgrade of the country’s credit rating to CCC from B- reflected “intensifying pressure on Lebanon’s financing model and increasing risks to the government’s debt servicing capacity.”
S&P Global affirmed Lebanon’s credit rating at B-/B and said the outlook remains negative. It considers Lebanon’s foreign exchange reserves sufficient to service government debt in the “near term”. Friday’s downgrade would have no “material impact” on investor holdings of Lebanon’s bonds as the debt was already rated non-investment grade, said Jan Dehn, head of research at emerging markets investment manager Ashmore Group. “The government has done more on the reform side than many Lebanese governments in the past.”
Flagrant Corruption is the norm at the highest level of government; and they are entrusted to solve the issue?