Fitch upgraded rating of railroads of Kazakhstan to "BBB"

/REUTERS, December 22, 05/ - Fitch Ratings has today upgraded Kazakhstan Temir Zholy's ("KTZ"), the national railway company in Kazakhstan, Senior Unsecured rating to 'BBB' from 'BBB-' (BBB minus). Following the upgrade, the Outlook is now Stable. KTZ's rating action follows the recent upgrade of Fitch's sovereign rating for Kazakhstan to 'BBB' from BBB-' (BBB minus) (see rating announcement dated 20 December 2005 on www.fitchratings.com). KTZ's rating reflects its government ownership and expected state support in case of need. The rail infrastructure, mainly used for freight traffic, is also of national strategic importance to the republic's economy. Any change in the current ownership structure of KTZ requires parliamentary approval. Furthermore, KTZ's board is primarily made up of government appointees, while the governmental anti-monopoly agency sets the company's domestic tariffs. Although the setting of KTZ's tariffs is trying to establish economically objective criterion, the process is still tinged with political considerations. Kazakhstan's rail infrastructure provides key transport links from Asia to the West, using KTZ's Northern Corridor on the Trans Asian Railway; the Central Corridor (Siberian rail route), which connects up to Western Europe and the Baltics. On the western side, the TRACECA route links to Aktau port - Kazakhstan's only gateway to the sea. Commodities transported include coal, ore, oil, grain and others (such as consumer goods and raw material from/to China). Contacts: John Hatton, London, Tel: +44 (0) 20 7417 4283; Nikolai Lukashevich, Moscow, +7 095 956 9968. Media Relations: Jon Laycock, London, Tel: +44 20 7417 4327. Fitch's rating definitions and the terms of use of such ratings are available on the agency's public site, www.fitchratings.com. Published ratings, criteria and methodologies are available from this site, at all times. Fitch's code of conduct, confidentiality, conflicts of interest, affiliate firewall, compliance and other relevant policies and procedures are also available from the 'Code of Conduct' section of this site. [2005-12-22]