Moody's Raises Indonesia's State Debt Securities Prospect
Tuesday, 06 February, 2007 | 09:38 WIB

TEMPO Interactive, Jakarta: International rating organization Moody's Investors Services raised the rating level of Indonesia's state debt securities from stable to positive.

This level is valid both for foreign currency and Rupiah bonds.

Steven Hess, Vice President of Moody's, said the revision to Indonesia's state debt securities rating reflected a consistent rise in the government's debt ratio and government's foreign debt position.

He went on to say that the political situation, which is relatively stable, shows that the government will continue its fiscal policy carefully in the coming years.

In a press statement yesterday (5/2), Hess said the government's budget deficit of one percent of Gross Domestic Product (GDP) last year, “is a continuation from the previous years when the government also listed a low deficit rate.”

According to Hess, the comparison between the low deficit rate and inclining GDP growth caused the decrease of the government's debt ratio against GDP.

“Indonesia's GDP, 42 percent by last year, is now equivalent with the debt ratio of other countries with higher ratings.”

In addition to Moody's, earlier the rating organization Fitch Ratings revised Indonesia's foreign and local currency ratings, known as issuer default ratings (IDR).
The revision was from stable to positive prospect.

The organization also maintained BB- rank, Indonesia's short-term IDR at B and country ceiling at BB.

YURA