Bangkok--20 Sep--Standard & Poor's
Standard & Poor's Ratings Services said today that it placed its 'BBB+' long-term foreign, 'A' long-term local, 'A-2' short term foreign, and 'A-1' short-term local currency sovereign credit ratings on the Kingdom of Thailand on CreditWatch with negative implications.
According to Standard & Poor's credit analyst Kim Eng Tan, the action reflects the possibility of sustained deterioration in the political situation in Thailand arising from today's military coup.
"A caretaker government has ruled Thailand since April 2006, following an election that failed to produce a government in accordance with the country's Constitution," said Mr. Tan. "Failure to return to civilian rule in accordance with the Thai Constitution in the near term would not only extend the existing state of policy paralysis, but also severely affect the country's investment climate," he added.
Mr. Tan explained that the political uncertainties arising from the coup, with the possible postponement of an election expected in November of this year, could impair creditworthiness—although fiscal and external flexibility provide a buffer, at least in the short term.
"If prolonged political uncertainty and diminished investor confidence undermine effective decision making and the government's economic and financial strengths, a negative outlook or a downgrade is likely," Mr. Tan noted. "A fairly rapid return to civilian rule in accordance with the country's constitution and renewed commitment to macroeconomic stability and needed reform likely would lead to the affirmation of existing ratings," he concluded.
Complete ratings information is available to subscribers of RatingsDirect, the real-time Web-based source for Standard & Poor's credit ratings, research, and risk analysis, at www.ratingsdirect.com . All ratings affected by this rating action can be found on Standard & Poor's public Web site at www.standardandpoors.com ; under Credit Ratings in the left navigation bar, select Find a Rating, then Credit Ratings Search. Media Contact:
Marc Eiger, New York, (1) 212-438-1280
[email protected]
David Wargin, New York (1) 917-502-4321
[email protected]
Analyst Contacts:
KimEng Tan, Singapore (65) 6239-6350
Ping Chew, Singapore (65) 6239-6345
Marie Cavanaugh, New York (1) 212-438-7343
Standard & Poor's, a division of The McGraw-Hill Companies (NYSE:MHP), is the world's foremost provider of financial market intelligence, including independent credit ratings, indices, risk evaluation, investment research and data. With approximately 7,500 employees, including wholly owned affiliates, located in 21 countries. Standard & Poor's is an essential part of the world's financial infrastructure and has played a leading role for more than 140 years in providing investors with the independent benchmarks they need to feel more confident about their investment and financial decisions. For more information, visit http://www.standardandpoors.com .
Key Contacts:
Americas Media Relations: (1) 212-438-6667
media_ [email protected]
Americas Customer Service: (1) 212-438-7280
[email protected]