POND ISLAND–St. Maarten has retained its Baa2 rating from rating firm Moody’s. The firm issued its country report on June 1. Finance Minister Richard Gibson Sr. hailed this as a good development for the country. Baa2 is the ninth highest rating in Moody’s Long-term Corporate Obligation Rating. Obligations rated Baa2 are subject to moderate credit risk and are considered medium grade and as such may possess certain speculative characteristics. Rating one notch higher is Baa1.
Gibson Sr. said at the Council of Ministers Press Briefing on Wednesday the country is noted in the report as “low strength” compared to others with the same rating such as the Bahamas and the Cayman Islands. This was attributed to those islands having a financial sector while St. Maarten’s economy is solely tagged to tourism. Moody’s made special mention of the country’s resilience in bouncing back from natural disasters, said Gibson Sr.
The report is a “positive” one, he said, noting that in spite of losing some 17 per cent of cruise passenger arrivals between January and June 2016 compared to the same period in 2015 the country was able to have a balanced 2016 budget. Looking ahead, the report states the country has one of the lowest growth rates in the region. The country’s only route to expansion is tourism. Gibson Sr. said the situation is as such that one major project such as the Pearl of China will have a significant impact.
“We will do all our best to get the Pearl of China off the ground,” the Minister said.
Source: The Daily Herald https://www.thedailyherald.sx/islands/66665-country-maintains-baa2-moody-s-rating