Moody’s poor ratings on Fiji’s economy expose Aiyaz Khaiyum’s lies
RFN says : Aiyaz Khaiyum can blow his own trumpet until the cows come home but the reality of the matter is that the perception of the real players outside of Fiji is what matters. Coup riddled Fiji is a dot in the big ocean which makes deceitful pompous claims by Aiyaz as insignificant really in the whole scheme of things.
While Aiyaz is spinning his yarn with the help of Qorvis Communication that everything is funky dory in that sinking island state, the truth reveals itself by a consistent negative growth that continue to plague that little island since the December 5th, 2006 coup, which is confirmed all over again by Moody’s, Standard and Poor and other ratings orgs.
Who’se talk will people believe? That insignificant Aiyaz Khaiyum or these expert rating global organizations?
Announcement:
Moody’s Disclosures on Credit Ratings of Fiji, Government of
Singapore, January 19, 2012 –
The following release represents Moody’s Investors Service’s summary credit opinion on Fiji, Government of and includes certain regulatory disclosures regarding its ratings. This release does not constitute any change in Moody’s ratings or rating rationale for Fiji.
Moody’s current ratings on Fiji, Government of are:
Long Term Issuer (domestic and foreign currency) ratings of B1
Senior Unsecured (domestic and foreign currency) ratings of B1
RATINGS RATIONALE
Fiji’s B1 government bond ratings reflect a low level of economic resiliency, low government financial strength, and a high susceptibility to event risk. Some of Fiji’s statistical indicators–notably external debt ratios–compare favorably with countries in the same rating range. However, the ratings are constrained by these other factors. Low economic resiliency is indicated by very low GDP per capita and the small size of the economy. Low institutional strength reflects weak scores in the World Bank’s indices of governance and rule of law. The Reserve Bank’s independence has recently been compromised.
The government’s financial strength is assessed as low because of the high ratios of government debt and interest payments to government revenue. These are partially mitigated by two factors: (1) most government debt is held by the Fiji National Provident Fund, which will continue to invest in government securities over the medium term; (2) the proportion of debt denominated in foreign currency is relatively small, meaning that the government is not subject to exchange-rate risk or to adverse conditions in global financial markets.
Fiji is subject to political event risk. After the overthrow of the government in 2000, government finances deteriorated as did the level of investment in the economy. Real GDP growth and investment activity has similarly declined and subsequently stagnated following the December 2006 coup.
The negative outlook was maintained following the downgrade of the sovereign rating to B1 in April 2009 due to expectations of a continued deterioration in the balance of payments. Following a large devaluation of the Fijian dollar and the imposition of strict exchange controls, foreign exchange reserves rebounded as tourist arrivals and export shipments recovered. However, growth remains lackluster and has had an adverse effect on the trajectory of government debt, justifying the maintenance of the negative outlook.
The principal methodology used in this rating was Sovereign Bond Ratings published in September 2008. Please see the Credit Policy page on www.moodys.com for a copy of this methodology.
REGULATORY DISCLOSURES
Although this credit rating has been issued in a non-EU country which has not been recognized as endorsable at this date, this credit rating is deemed “EU qualified by extension” and may still be used by financial institutions for regulatory purposes until 30 April 2012. Further information on the EU endorsement status and on the Moody’s office that has issued a particular Credit Rating is available on www.moodys.com.
For ratings issued on a program, series or category/class of debt, this announcement provides relevant regulatory disclosures in relation to each rating of a subsequently issued bond or note of the same series or category/class of debt or pursuant to a program for which the ratings are derived exclusively from existing ratings in accordance with Moody’s rating practices. For ratings issued on a support provider, this announcement provides relevant regulatory disclosures in relation to the rating action on the support provider and in relation to each particular rating action for securities that derive their credit ratings from the support provider’s credit rating. For provisional ratings, this announcement provides relevant regulatory disclosures in relation to the provisional rating assigned, and in relation to a definitive rating that may be assigned subsequent to the final issuance of the debt, in each case where the transaction structure and terms have not changed prior to the assignment of the definitive rating in a manner that would have affected the rating. For further information please see the ratings tab on the issuer/entity page for the respective issuer on www.moodys.com.
