Fitch revises forecast on long-term issuer default rating of Turkmenistan

Turkmenistan Materials 24 February 2023 15:57 (UTC +04:00)
Khayal Khatamzadeh
Khayal Khatamzadeh
Read more

BAKU, Azerbaijan, February 24. Fitch Ratings has revised the Outlook on Turkmenistan's Long-Term Foreign-Currency Issuer Default Rating (IDR) to Positive from Stable and affirmed the IDR at 'B+, Trend reports, citing Fitch.

According to Fitch, external and sovereign balance sheets benefit from higher energy prices, data for 9M2022 show a current account surplus of $4.7 billion (6.9 percent of Fitch-projected full year GDP) and exports for the full year on a customs basis were up 43 percent year-on-year. Fitch expects continued surpluses in 2023 and 2024, albeit narrowing due to a fall in energy prices and a pick-up in imports related to capital spending.

"External debt fell to 6.1 percent of GDP at the end of 2022 and is projected to remain stable until the end of 2024. Sovereign net foreign assets increased by $4.9 billion in 2022 to $35.1 billion and are projected to rise by a further $5.4 billion to end-2024, equivalent to 54 percent of GDP ('B' median -25.3 percent)," Fitch Ratings said.

Fitch estimates, the completion of large repayments related to a specific project combined with the jump in external assets has significantly improved already strong external liquidity indicators. External debt service to current external receipts fell to 7.8 percent in 2022 ('B' median 17.3 percent) from 26.8 percent in 2020.

Fitch Ratings Inc. is an American credit rating agency and is one of the most reputable global rating agencies. The agency aims to provide business intelligence to facilitate the effectiveness of decision-making and decrease the business risks for its clients.