RTTNews - Friday, Fitch Ratings affirmed Romania's long-term foreign currency Issuer Default Rating or IDR at 'BB+' and long-term local currency IDR at 'BBB-', both with negative outlooks.
The rating agency also affirmed the country ceiling and the short-term foreign currency IDR at 'BBB' and 'B', respectively.
Romania had secured a US$26.4 billion international support package in May 2009, including a two-year US$17.1 billion IMF stand-by arrangement. The agency said its creditworthiness is supported by IMF-backed adjustment programme. But the authorities' ability to adhere to the tough policy strategy needed under the plan will be crucial.
Director in Fitch's Sovereigns Group, Andrew Colquhoun said The outlook for the world economy has deteriorated significantly since the ratings were downgraded last November, adding to the risks facing Romania as its economy adjusts to weaker net private sector capital inflows.
The IMF backed adjustment programme calls for a fiscal deficit of 5% of GDP in 2009. This will force the nation to adopt tight fiscal tightening of possibly around 3% of GDP in cyclically adjusted terms in the midst of severe recession.
Romania is one of the nations that are most exposed to external financing risk among 11 economies assessed in Fitch's May 2009 report.
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