Guatemala improved the risk-pais qualification and the agency is late S&P Global Ratings changed the note from BB to BB+, So the result provided by the qualifier is positive in the middle of a global context with uncertainty and in which they also make observations.
“Guatemala BB+ qualifications reflect their macroeconomic stability and economic stability history,” It exposes the S&P bulletin released on the afternoon this Friday, May 23.
In addition, the agency places the new note for Guatemala in a stable perspective, which means that for the next cycle or for the next 12 months, it does not plan to make changes.
This result corresponds to the visit that in March of this year made delegates of this agency and Place Guatemala to a “step” or “step” to reach investment grade, They explained monetary authorities.
Basis
The document makes a display of the description of the note and in which it indicates “that the country’s manageable fiscal deficits, its very low net debt, its strong external profile and the history of a solid monetary policy constitutes a key credit strength. On the other hand, on the other hand, The country faces important social and infrastructure needs, which restrict growth prospects ”.
On the other hand, the agency recognizes that the Government and the Congress of Guatemala can consistently collaborate in political initiatives to improve the resilience of its economic model and increase the level of wealth of its population. “This could increase investor confidence and lead to economic growth greater than expected, higher capita income and better social indicators”
He reiterates that political negotiations between the Government and Congress have recently allowed more collaboration in political initiatives.
He adds that “the qualifications incorporate our vision of public institutions still in the development of Guatemala, historically high” and that Guatemala has maintained cautious fiscal and monetary policies despite political evolution.
Juncture
The Global Ratings report indicates “that there is a high degree of unpredictability around the implementation policy by the US administration and their responses (especially with respect to tariffs) and the potential effect on economies, supply chains and credit conditions worldwide”
The agency indicates that “the base forecasts entail a significant amount of uncertainty.” “The deceleration of the US economy will hinder Guatemala’s growth due to its current ties with migration, remittances, exports and investments.”
Then, the history of macroeconomic policies should help mitigate adverse impacts, the agency points out.
“The strong external position of Guatemala with high international reserves and net external debt (crediting position) and the fiscal balance of the general debt of the general government below 20% of GDP will help face more restrictive American policies in migration and remittances. We believe that the impact of tariff policy will be limited”, He argues.
They celebrate qualification
For Juan Carlos Zapata, Executive Director of the Foundation for the Development of Guatemala (Fundesa) the S&P note “marks an important improvement, especially before the international climate you have.”
In his opinion, analysts reflect the improvements that have been observed in institutional issues such as Approval of the Priority Road Infrastructure Law, the Competition Law and a positive perspective to a greater investment in the country, Improvement in macroeconomic stability indices and conditions for the attraction of new capitals.
“This helps to have a better perspective for investors,” Zapata said.
The manager remarked that negotiations have allowed a better collaboration in public policies, the stability of macroeconomy, the efforts of public capacity for investment attraction, as well as infrastructure as happened with the subscription for the expansion and modernization of the Port Company Quetzal (EPQ) this week.