22 Feb 2011

Fiji's outlook rating improves

4:18 pm on 22 February 2011

The ratings agency, Standard and Poor's, has revised Fiji's Outlook rating from stable to positive, but has re-affirmed its foreign currency rating at B minus.

The agency says the outlook has changed because of an improvement in Fiji's external position, including the level of foreign exchange reserves.

But credit analyst, Kyran Curry, says the foreign currency rating of B minus is one the of the lowest ratings.

He explains the significance of the outlook rating:

"That really means we believe there is a one third chance of the ratings improving over the next two to three years. So if you look at it the other way we are saying really there is a two thirds chance that the rating will stay as it is."

He said the B minus rating puts Fiji in the same band as Pakistan and Jamaica, but below regional neighbours such as the Cook Islands and Papua New Guinea are both rated two notches higher.

However Fiji's interim leader, Commodore Frank Bainimarama, has welcomed the change saying it is expected to strengthen investor confidence and attract investment.