Moody's has changed Vietnam's 'Ba3' foreign-currency government bond rating outlook to positive from stable on continued success in the country's external development policies and stable fiscal position, a report said.
The rating agency had assigned a 'Ba3' local-currency government bond rating, also with a positive outlook, the AFX news agency report added.
'The change in outlook was prompted by continued success in the country's externally oriented development policies and overall stability in the government's fiscal position even as the authorities deliberately run budget deficits to finance investment and to boost the level of national income,' said Moody's vice president Tom Byrne.
Moody's said Vietnam's foreign-currency country ceiling for bonds and notes remains at 'Ba2', with a stable outlook.
The outlook on the country's 'B1' foreign-currency ceiling for deposits was changed to positive from stable, and the local currency bond ceiling remains at 'Ba1'.
For Vietnam's rating to move up some concern about policy capabilities will need to be allayed, namely, fiscal deficits should be contained and the increase in government debt restrained.
“Macroeconomic stability could be threatened by an unabated surge in capital inflows due to loose monetary control or an inappropriate exchange rate policy, and fiscal sustainability could be challenged by excessive increases in expenditure or a sharp fall in oil prices and petroleum sector revenues,” the report quoted Byrne as saying.
Source: Thanh Nien
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