henryngo
18-09-2006, 11:54 PM
07 Sep 2006S&P lifts Vietnam's rating by one notch to BB
Standard & Poor's said on Thursday it had upgraded Vietnam's foreign currency rating by one notch to BB, citing the country's economic reforms.
The rating agency also lifted the country's local currency rating to BB+ from BB. The outlook on the ratings is stable.
Vietnam's sovereign dollar bonds rose after the announcement.
"The upgrade reflects the increased economic growth potential of the Vietnamese economy, which has resulted from the ongoing efforts of the government to improve essential public infrastructure and the investment climate," S&P credit analyst Kim Eng Tan said in a statement.
"Measures to introduce foreign participation in the domestic banking system have also laid the foundation for greater financial stability going forward," Tan said.
Vietnam is now rated one notch higher than the Philippines and Indonesia.
"The key driver here is the WTO (World Trade Organisation) process. It looks like the WTO is going to be finalised and signed in the next 2 to 3 months," said Scott Wilson, sovereign credit analyst at UBS.
"That's critically important because it locks in the reform programme in Vietnam," he said, adding that Vietnam is an improving sovereign credit.
Vietnam could join the WTO by the end of this year, which will further generate trade and investment opportunities for the country.
Vietnam government spokesman Le Dung said the country's plan to join the WTO was providing an impetus for reform.
"We are also re-doubling our efforts to join the WTO at the earliest possible date and therefore we have incentive to help reform in Vietnam to meet international standards and to get more and more into the world economy," he said.
Vietnam's economy, one of the fastest-growing in recent years after neighbouring China, should expand by 8 percent this year, as targeted, the government said last Friday.
Gross domestic product in January-June rose 7.4 percent from the same period last year, led by construction and industrial sectors.
Its stock markethas gained 66 percent so far this year.
Standard & Poor's said on Thursday it had upgraded Vietnam's foreign currency rating by one notch to BB, citing the country's economic reforms.
The rating agency also lifted the country's local currency rating to BB+ from BB. The outlook on the ratings is stable.
Vietnam's sovereign dollar bonds rose after the announcement.
"The upgrade reflects the increased economic growth potential of the Vietnamese economy, which has resulted from the ongoing efforts of the government to improve essential public infrastructure and the investment climate," S&P credit analyst Kim Eng Tan said in a statement.
"Measures to introduce foreign participation in the domestic banking system have also laid the foundation for greater financial stability going forward," Tan said.
Vietnam is now rated one notch higher than the Philippines and Indonesia.
"The key driver here is the WTO (World Trade Organisation) process. It looks like the WTO is going to be finalised and signed in the next 2 to 3 months," said Scott Wilson, sovereign credit analyst at UBS.
"That's critically important because it locks in the reform programme in Vietnam," he said, adding that Vietnam is an improving sovereign credit.
Vietnam could join the WTO by the end of this year, which will further generate trade and investment opportunities for the country.
Vietnam government spokesman Le Dung said the country's plan to join the WTO was providing an impetus for reform.
"We are also re-doubling our efforts to join the WTO at the earliest possible date and therefore we have incentive to help reform in Vietnam to meet international standards and to get more and more into the world economy," he said.
Vietnam's economy, one of the fastest-growing in recent years after neighbouring China, should expand by 8 percent this year, as targeted, the government said last Friday.
Gross domestic product in January-June rose 7.4 percent from the same period last year, led by construction and industrial sectors.
Its stock markethas gained 66 percent so far this year.