Standard & Poor’s has affirmed Hungary’s BB/B long- and short-term sovereign credit ratings with a stable outlook but warned that medium-term prospects remain clouded by the government's policy mix and a shrinking population.
Hungary's ratings are supported by the country's comparatively advanced economy, highly-skilled labour force and relatively well-diversified economic and export structures, the ratings agency said in a statement. In addition, the government's success in maintaining general government borrowing needs within EU limits as well as its commitment to financing itself solely in local currency also supports the rating, S&P said.
On the other hand, the ratings remain constrained by the country's external position and the government's foreign exchange exposure on its own stock of debt.
S&P revised upwards its projection for Hungary’s economic growth to more than 3% in 2014. The agency expects that the size of the Hungarian economy will return to 2007 levels by end-2015.
The rating agency expects the government to meet its deficit target of 2.9% of GDP. However, the cabinet is not expected to make significant progress on debt reduction and the level of gross general government debt to GDP would remain close to 80% of GDP, S&P warned.
The agency said that it would consider upgrading the country's ratings if there is evidence that the government’s policy encourages investment and promotes sustainable growth.
Finland has issued a second and final permit for the construction of the controversial Nord Stream II pipeline that is to pump gas from Russia directly to Germany via a Baltic Sea route, the Regional ... more
Three large German companies have chosen to invest in Debrecen, Hungary's second-largest city, since Lufthansa launched its first direct flight two years ago, it was announced on April 11. ... ... more
Green opposition party Politics Can Be Different (LMP) has suspended talks with fellow opposition parties after they failed to reach a cooperation agreement ahead of the April general election. ... more