Barbados 'B/B' Ratings Affirmed; Outlook Remains Negative

OVERVIEW Barbados' fiscal deficits remain high, and its debt burden continues to rise, with limited financing options. We expect GDP growth of about 1% this year and 2% in 2016, still lower than that of peers at a similar stage of economic development. We are affirming our 'B/B' sovereign credit ratings on Barbados. The negative outlook reflects the potential for a downgrade pending additional signs of success in gradually stabilizing the debt burden, if tourism investment projects fail to support a turnaround in growth, or if external pressures mount. RATING ACTION On Sept. 14, 2015, Standard&Poor's Ratings Services affirmed its 'B' long-term sovereign credit ratings on Barbados. The outlook remains negative. We also affirmed our 'B' short-term sovereign

...Key rating factors Assessments Institutional assessment Neutral Economic assessment Weakness External assessment Weakness Fiscal assessment: flexibility and performance Weakness Fiscal assessment: debt burden Weakness Monetary assessment Weakness Note: Standard & Poor's analysis of sovereign creditworthiness rests on its assessment and scoring of five key rating factors: (i) institutional assessment; (ii) economic assessment; (iii) external assessment; (iv) the average of fiscal flexibility and performance, and debt burden; and (v) monetary assessment. Each of the factors is assessed on a continuum spanning from 1 (strongest) to 6 (weakest). Section V.B of Standard & Poor's "Sovereign Rating Methodology," published on Dec. 23, 2014, summarizes how the various factors are combined to derive the sovereign foreign currency rating, while section V.C details how the scores are derived. The ratings score snapshot summarizes whether we consider that the individual rating factors listed in our...

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