The agency maintains a B rating for the country with a “stable” outlook, as it is confident the country will receive external aid by 2021.
Risk assessment agency Standard and Poor’s confirmed on Thursday that it is maintaining its B rating with a stable outlook for the country, as it expects “El Salvador will continue to receive significant external support in 2021 that will provide liquidity and mitigate refinancing risk. of public debt over the next 12-18 months.
However, the rating agency warned that it could lower this rating in the next 12 months if it faces difficulties in accessing financing from official creditors and international markets “and does not take corrective tax action, which in turn could highlight local market conditions. . ”Says the statement.
“We could also lower the government’s rating if the economic recovery is delayed, affecting long-term trend GDP growth and keeping budget deficits high for longer than we currently expect,” the US agency said.
The Bukele government is negotiating an agreement with the International Monetary Fund
And on the contrary, in an optimistic scenario, the agency confirms that it could confirm that it could increase ratings in the next 12 to 18 months if the economic recovery is stronger than expected and translates into stronger fiscal and external results, which it would to do. announce a substantial decrease in the debt burden.
“We hope the government will make gradual progress in implementing its plans to boost economic growth and strengthen public finances,” the document released today.
The risk assessment agency’s considerations come along with the government’s confirmation that it has begun talks with the International Monetary Fund (IMF) with which it would seek funding for at least $ 1.3 billion and a range of fiscal measures that would make it more possible . confidence of other economic institutions.