S&P downgraded the outlook on ratings of Belarus

S&P downgraded the outlook on ratings of Belarus

S&P downgraded the outlook on ratings of Belarus

The rating agency Standard & Poor's has revised the forecast for the long-term sovereign ratings of Belarus on liabilities in foreign and national currency from “stable” to “negative”, S&P said in a statement. At the same time, the agency has affirmed Belarus' long-term and short-term ratings at 'B / B'.

The negative outlook reflects growing risks to the financial stability of the Belarusian banking system (much of which is under state control), as evidenced by residents' conversion of savings into foreign currency and partial withdrawals of deposits, which accelerated during August following the disputed presidential election. In the event of a negative scenario, this could lead to the depletion of the central bank's foreign exchange reserves and create risks for the government to realize contingent liabilities. Since the beginning of August, the country's total reserves have decreased by $ 1.4 billion, to a level at which they are equivalent to 2.6 months of imports, ” – the agency said in a statement.

S&P may downgrade Belarus if the government does not have access to international capital markets, while additional funds in the form of bilateral loans will not be enough to service maturing debt obligations.

The agency may revise the rating forecast again to “stable” in the event of a decrease in political uncertainty, which would help to strengthen the economic and budgetary indicators of Belarus, as well as increase the stability of the country's financial sector, S&P notes.

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