JAKARTA: Standard & Poor’s ( S&P ), the only global rating agency that has yet to release an update on Indonesia’s sovereign rating, says the country’s economy is “fairly good” while its trading partners are under pressure.
S&P gives a BB+ rating for Indonesia, slightly below investment grade rating of BBB, with a positive outlook. The agency’s team is currently carrying out an assessment to update Indonesia’s rating, according to S&P director of sovereign Asia-Pacific Ex. Japan Kyran Curry.
“It is too early to speculate on the upcoming rating, but the numbers related to the risk look relatively good. The government’s fiscal position remains sound; the external position is in relatively good shape. The downside risk is mainly the external trading partner growth, but the economic environment is fairly good for Indonesia,” he told thejakartapost.com on Monday in Jakarta.
Curry led the S&P team as the ratings agency began its annual assessment by visiting and questioning the Jakarta administration. The assessment will last a week and the team will visit governmental and non-governmental figures, as well as infrastructure projects.
Moody’s Investors Service Inc. in January decided to keep Indonesia’s sovereign rating at Baa3 with a stable outlook. S&P, however, has yet to update its rating.
“The next step is taking the rating higher into the investment grade or revising the outlook back to stable. Moody’s may choose to keep it but that is their own decision. We may have a different one, that is why we are here and we were pleased with the meeting today,” Curry said.
