S&P Global Market Intelligence presents a summary of ratings actions on sovereigns and other key territories from Sept. 30 to Oct. 6.
EUROPE
* Moody's upgraded Czech Republic's long-term issuer ratings to Aa3 from A1, while revising the outlook to stable from positive, citing the country's improved fiscal strength metrics and economic performance, with support from the government's industrial reforms and innovation across sectors. Moody's said the outlook revision reflects the country's robust economic structure and institutional framework, offset by credit challenges faced from an aging society on long-term fiscal stability.
* DRBS upgraded Portugal's long- and short-term foreign- and local-currency issuer ratings to BBB (high)/R-1 (low), with a stable trend, citing its balanced fiscal position and declining government debt-to-GDP ratio. The rating agency said Portugal's diversified exports and growing investments in the private sector should support healthy economic growth.
* S&P Global Ratings affirmed Belarus' long- and short-term foreign- and local-currency sovereign credit ratings at B/B, with a stable outlook, citing its financial aid from Russia and slowed debt accumulation and inflation rate, offset by the country's low institutional effectiveness, vulnerable balance-of-payments position and limited flexibility in monetary policy.
* Fitch Ratings affirmed Belgium's long- and short-term foreign- and local-currency issuer default ratings at AA-/F1+, with a stable outlook on the long-term ratings, citing the country's high public sector indebtedness, offset by high per capita income and macroeconomic stability. The rating agency said the country's high debt level is partially balanced by decreased borrowing requirements, lower interest rates and increased average debt maturity.
* Fitch affirmed Estonia's issuer default ratings at AA-/F1+, with a stable outlook, citing the country's strong policies with support from robust economic institutions, low debt levels and its net external creditor position, balanced against lower per capita income, higher growth volatility and its exposure to shocks.
ASIA PACIFIC
* S&P affirmed China's unsolicited sovereign credit ratings at A+/A-1, with a stable outlook, citing the government's reform agenda, growth prospects and strong external metrics, offset by certain weaker credit factors, such as low average income, less transparency and restricted flow of information. Despite weaker expectations of economic growth for the next few years, the rating agency said it continues to expect Chinese real GDP growth to exceed 5% annually for the next three to four years.
* Moody's affirmed Cambodia's long-term issuer ratings at B2, with a stable outlook, on the back of robust GDP growth prospects, moderate government debt levels and low external vulnerabilities, offset by risks from a high rate of credit growth. Moody's added that Cambodia's low institutional strength and high degree of dollarization puts the economy's ability to manage shocks under pressure.
* Moody's affirmed Solomon Islands' foreign- and local-currency long-term issuer ratings at B3, with a stable outlook, citing ongoing fiscal reforms supporting the country's fiscal strength and sovereign credit profile, offset by the rating agency's expectations of its debt burden increasing in the coming years, very low economic resilience, low incomes and structural and institutional constraints.
MIDDLE EAST AND AFRICA
* Fitch downgraded Saudi Arabia's long-term ratings to A from A+, with a stable outlook, citing mounting geopolitical tensions in the Gulf region putting pressure on the country's economic infrastructure and already falling fiscal and external balance sheets. Fitch believes that the country's oil facilities are vulnerable to more attacks, after the recent drone strike on an oil facility that brought half of its production to a halt. The rating agency affirmed the country's short-term ratings at F1+.
* Fitch downgraded Namibia's issuer default ratings to BB from BB+ and revised the outlook to stable from negative, citing subdued economic prospects amid heightened inequality and high unemployment, weighing on the government's plan to stabilize debt by limiting spending. Fitch is forecasting a third consecutive year of recession for the country. The rating agency affirmed Namibia's short-term ratings at B.
* Fitch revised the outlook on Ethiopia's long-term ratings to negative from stable and affirmed the issuer default ratings at B/B. The outlook revision reflects the possibility of continued political unrest in the country stemming from regional and ethnic violence and tensions within the ruling political coalition, which could have "meaningful" spillovers to the economy and continue to keep tax collection and foreign direct investment under pressure.
* Moody's placed Lebanon's Caa1 issuer rating under review for downgrade, citing recent tightening in external financing conditions and a reversal in bank deposit inflows weighing on the country's already deteriorating balance of payments dynamics. Moody's said the action also reflects the country's increased domestic and geopolitical risks, including renewed tensions with Israel.
* S&P revised the outlook on Morocco's sovereign credit ratings to stable from negative, forecasting further fiscal consolidation and a gradual improvement in the country's current account position in the next couple of years against economic risks from domestic or external shocks. The country's sovereign credit ratings were affirmed at BBB-/A-3.
* Moody's affirmed Senegal's issuer ratings at Ba3/Not Prime, with a stable outlook, citing the country's continued transparent economic policies, supporting steady GDP growth, strong institutional strength and policy effectiveness. Moody's said the positives are offset by high government debt, pressuring Senegal's ability to absorb shocks.
* Capital Intelligence Ratings affirmed Bahrain's long- and short-term foreign- and local-currency ratings at BB/B, with a negative outlook.
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