Jerusalem, 17 February 2000
Standard and Poor Raise Israel's Credit Rating
(Communicated by Finance Ministry Spokesman)
The international credit rating firm Standard & Poor yesterday
(Wednesday) 16.2.2000, raised Israel's external outlook credit rating
from "stable" to "positive" and confirmed the external credit
rating A- and the internal credit rating of AA-. According to a
company press release, the change reflects the significant
changes in the structure of the Israeli economy, the significant
improvement in the balance of payments and the trustworthiness of
its monetary policies. S&P stated that the structural reforms,
including bank privatization, foreign currency liberalization,
and business environment deregulation, have brought about
long-term growth potential of 4-5%. S&P also stated that the
raising of Israel's credit rating depends on the continued
reduction of the government deficit, implementing structural
reforms and maintaining a low inflationary environment.
Finance Minister Avraham Shohat expressed considerable
satisfaction at the announcement, stating that it expresses S&P's
evaluation regarding Israel's economic situation, which will
further strengthen Israel's economic standing in the world.
The raising of Israel's credit rating by both S&P and Moody's
represents a qualitative jump for the Israeli economy as a
developed state with regard to international investors, so that
debates on the premiums that the country has to pay will be a
function of its economic behavior rather than its political
environment.
The raising of Israel's rating is occurring against the
background of Accountant-General Nir Gilad's preparations of for
an issue in the world's financial markets and follows a visit to
Israel by S&P representatives. He said that the faith expressed
by the world's leading credit-rating companies in the Israeli
economy will contribute to the trust of investors in Israel's
first global issue.