Rating agency Standard & Poor’s today maintained Thailand’s credit rating at BBB+, saying the country’s economic fundamentals are positive but political uncertainty continues to be a risk factor.
S&P credit analyst Kim Eng Tan said financial factors, particularly debt in the public sector, though stable in the short term, must be closely monitored as surging public debt will have a negative impact on the country’s credibility.
TRIS Rating president Santi Kiranand said the BBB+ rating for Thailand has remained unchanged for the last three years, below Singapore’s AAA rating and Malaysia’s A- rating.
Two key risks involving political instability and natural disasters have been remedied but Thailand’s per capita income remains low – a significant criteria in S&P’s rating, he said.
He said the government’s investment in mega projects, the increase of daily minimum wage to Bt300, stimulus packages on consumption, public and private investments and export will boost Thailand’s gross domestic product and overall economy – positive factors that may contribute to a rating upgrade in the next few years.
“We have explained [to S&P] that the average income of Asian people [cannot be compared] to European and US populations. Their cultures and costs of living are different,” he said.
Though the country’s credit rating has not improved, investors are still keen on investing in Thailand’s stock market and bonds, consequently contributing to rapidly appreciating Thai baht, he concluded. (MCOT online news)
via S&P keeps Thailand’s BBB+ rating unchanged, warns of state splurge | MCOT.net.