Standard and Poor's downgrades T&T's sovereign credit ratings
International financial services company, Standard and Poor's (S&P), has downgraded Trinidad and Tobago's creditworthiness as it seeks to give investors insight into the level of risk associated with investing in the country's debt.
In a statement on Tuesday, S&P said it lowered the country's long-term foreign and local currency sovereign credit ratings to BBB from BBB+. However, the outlook remained stable. It also affirmed T&T's short-term foreign and local currency sovereign credit ratings at A-2.
S&P said this is as a result of a drop in energy production and the government's failure to improve its current revenue collection strategies.
"The Republic of Trinidad and Tobago's lower-than-expected energy production and economic growth will weaken the government's revenue base and delay its plans to balance the budget by fiscal year 2020-2021. At the same time, institutional reforms to strengthen revenue collection and improve the provision of timely economic data have taken longer than expected, and we do not expect to see material dividends from these reforms in the near term," the release said.
Meanwhile, S&P said it is also revising down its transfer and convertibility assessment to 'BBB+' from 'A'. The financial agency said its stable outlook reflects its expectation that Trinidad and Tobago's large government financial assets will continue to provide a fiscal and external safeguard that will mitigate economic volatility.