Fitch affirms ratings of Republic of Kazakhstan, outlook Stable
22.02.21 10:32
/Fitch Ratings, London, 19.02.21, heading by KASE/ – Fitch Ratings has affirmed
the long-term foreign currency issuer default rating (IDR) of Kazakhstan at
"BBB" with a "Stable" outlook.
KEY RATING DRIVERS
Kazakhstan's 'BBB' IDRs balance strong fiscal and external balance sheets
underpinned by accumulated oil fiscal revenues, against a high dependence on
commodities and lower, but improving, governance scores relative to 'BBB' rated
peers. Government indebtedness remains low and external and fiscal buffers
have been resilient to the coronavirus and oil price shocks.
Large sovereign external buffers are a key rating strength and are forecast to
remain robust. The combined external assets of the state oil-fund (NFRK) and
official international reserves held by the central bank (NBK) rose to USD94
billion or 57% of GDP at end-2020 (2019: 50%), boosted by global financial asset
returns including rallying gold prices, and limited foreign exchange sales.
Sovereign net foreign assets, of 49% of GDP at end-2020, are significantly
larger than the current 'BBB' median of -2.4%, but should moderate to 43% by
end- 2021 and 39% in 2022 as fiscal oil revenue savings recover only gradually
relative to nominal GDP growth. There are upside risks to our external reserves,
current account and fiscal forecasts as Brent crude oil prices have averaged
USD57/b year-to-date, compared with Fitch's current annual oil price assumption
of USD45/b for 2021.
* The full press release is available on Fitch Ratings website.
[2021-02-22]