Research Update: Andorra Outlook Revised To Stable From Positive As COVID-19 Causes Deficits To Spike; 'BBB/A-2' Ratings Affirmed

We expect Andorra's economy to contract in 2020 as the effects of the COVID-19 pandemic kick in, before recovering in 2021 and thereafter. The fiscal stimulus Andorra is applying to the economy will lead to larger-than-anticipated fiscal deficits and, consequently, a substantial increase in government debt. The government is still in talks regarding gaining full membership of the International Monetary Fund (IMF). In the context of a global recession and a budgetary position that is much weaker than anticipated, we are revising our outlook on Andorra to stable from positive and affirming our 'BBB' long-term and 'A-2' short-term sovereign credit ratings. On April 24, 2020, S&P Global Ratings revised its outlook on Andorra to stable from positive. At the same

...- We expect Andorra's economy to contract in 2020 as the effects of the COVID-19 pandemic kick in, before recovering in 2021 and thereafter. - The fiscal stimulus Andorra is applying to the economy will lead to larger-than-anticipated fiscal deficits and, consequently, a substantial increase in government debt. - The government is still in talks regarding gaining full membership of the International Monetary Fund (IMF). - In the context of a global recession and a budgetary position that is much weaker than anticipated, we are revising our outlook on Andorra to stable from positive and affirming our '###' long-term and 'A-2' short-term sovereign credit ratings....

Research Update