International credit ratings agency’s Moody’s has rated Colombia’s government bond rating higher than at any time in history, putting it on par with economic powerhouse Brazil, according to media reports on Tuesday.
Back in June, an analyst for the rating’s agency foreshadowed that a rise in the rating was on the cards due to strong growth figures.
MORE: Colombia’s credit rating could upgrade to match Brazil, Peru: Moody’s analyst
On Tuesday, Moody’s Investors Service, one of the “Big Three” credit rating agencies worldwide, upgraded Colombia’s rating in foreign currency one level from Baa3 to Baa2, and the short-term levels from P-3 from P-2, according to Bogota’s W Radio The overall rating outlook for Colombia is now “stable,” according to Moody’s.
The rating of Baa2 puts Colombia on par with other successful economies in the region such as Brazil, international news agency Bloomberg News reported.
Combined with ratings from the two other major international rating agencies, Standard & Poor’s and Fitch, Colombia now sits at the BBB/Baa2 category, signaling that the country is emerging confidently as a strong economy with plenty of potential growth and moderate credit risk, W Radio reported.
More growth expected
The agency cited the expected hike in economy growth from President Santos’s upcoming $25 billion highway project as contributing to the higher rating, according to Bloomberg.
“This is excellent news for the country,” said Colombia’s Minister of Finance Mauricio Cardenas as quoted in W Radio. “This is the first time in history that Moody’s has given us such a high rating, which reflects this great moment in the Colombian economy.”
Colombia is one of the only countries in the region showing significant economic growth: the economy grew by 4.7% compared to 4% in 2013, while other countries in the region demonstrated a slowing pattern.
MORE: IMF estimates Colombia’s economy to grow 4.5% in 2014
The country is estimated to grow another 4.7% this year, and 5.5% over the next five to 10 years according to the Wall Street Journal.
Moody signaled their confidence for the future of the Colombian economy in its continual strong and sustained growth, as well as the fiscal responsibility to the country by government officials in complying with fiscal goals and the commitment to future improvement of debt indicators.
Sources
- Moody’s elevó la calificación de Colombia (W Radio)
- Moody’s Upgrades Colombia’s Government Bond Rating (The Wall Street Journal)