Fitch-Eric Arispe: The downgrade of Armenia`s rating from the previous BB- to the current B + was of a regional nature - dependence on Russia was taken into account

ArmInfo. The downgrade by Fitch  Ratings of Armenia's rating from the former "BB-" to the current "B  +" was based on a regional approach - dependence on Russia was taken  into account. This was announced at the conference in Yerevan on July  4 by Eric Arispe, the director of the department on sovereign ratings  of Fitch Ratings.

He recalled that Fitch has been rating Armenia since 2006, when the  agency assigned the country a sovereign rating of "BB-", later - in  2008 it was followed by an increase to "BB". When the crisis came,  and taking into account its strong influence on the country, the  rating was reduced to the previous "BB-". In 2014, taking into  account external shocks and dependence on Russia, another decline to  "B +" followed, and this level continues to this day.

"Our rating reflects the country's willingness to service its debt.  We consider four directions:  macroeconomic policy, state finances,  external accounts, structural factors." According to our current  assessment, Armenia occupies a neutral position in all directions,  but there are also strengths. At the moment, the trend is stable.  From the position of shocks, it is difficult to imagine a stronger  one than it was after 2013, but the Central Bank took all possible  measures to neutralize them, and the government was able to quickly  navigate with the implementation of the budget. Our estimation is   restrained ", - underlined E Arispe.

He believes that in Armenia at the macro level the environment for  investment growth is favorable.  Improvement of the current account  deficit in the balance of payments (over the last 2 years, the  decline from 10% to 3% of GDP - Ed.) Was not only due to cyclical  factors, but also structural changes. "But to apply for a rating on  the BB scale, this level needs to be further reduced, increased  export growth, higher GDP growth, and a reduction in external debt."  We believe that the monetary policy pursues accelerates tax  collection. The situation will be more stable than in the past, "E.  Arispe concluded.