KATHMANDU, Nov 22 (NNN-XINHUA) – Credit rating agency, Fitch, has given Nepal “BB,” with a stable outlook in the country’s first-ever sovereign credit rating.
Releasing the rating outcome yesterday, Fitch categorised Nepal in its speculative grade, as its rating from BB to D falls under this category.
The speculative grade signals either a higher level of credit risk, or that a default has already occurred, according to the agency’s website.
According to its rating report on Nepal, Fitch had examined the country’s creditworthiness, based on its public debt, federal government’s deficit, revenue shocks, basic fiscal framework, current account, external creditors, economic growth recovery, banking sector vulnerability, political development and governance, among others.
It said that, Nepal has a strong debt affordability, because more than 40 percent of government debts are external and highly concessional, with an average maturity of nearly 13 years, and an average interest rate of about one percent.
Fitch had found certain problems in Nepal’s banking and financial sector. “Financial soundness indicators are deteriorating, but remain adequate,” the report noted.
Nepal first announced its plan about conducting the sovereign credit rating as early as 2019.– NNN-XINHUA
