Standard & Poor’s (S&P) raised Indonesia’s credit rating to investment grade, a reflection of the rating agency’s increased confidence in the stability of the country’s ruling coalition government and its ability to manage its finances, according to ABC News.
S&P raised Indonesia’s long-term rating to “BBB minus”, indicating that the Southeast Asian nation – which is the fourth most populous country in the world – has the capability to repay its debts.
“The government has built a political coalition with a parliamentary majority. Despite the government having a greater number of political parties, it has managed to appoint individuals who are generally viewed as competent to the key economic ministerial positions,” S&P said a statement.
The upgraded rating by S&P – the last of the three major credit ratings agencies, including Moody’s and Fitch, to give Indonesia an investment grade rating – has the potential to increase the country’s attractiveness to foreign investors and decrease the cost of borrowing in foreign currencies.
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