On Aug. 5, 2004, Standard & Poor's Ratings Services lowered its long-term foreign currency sovereign credit rating on Barbados to 'BBB+' from 'A-' and its long-term local currency rating on Barbados to 'A-' from 'A+'. At the same time, Standard & Poor's lowered its short-term local currency rating on Barbados to 'A-2' from 'A-1'. The outlook on both the local and foreign currency ratings is stable. The downgrades reflect the government's decreased fiscal flexibility as a result of slower-than-expected deficit reduction and significant off-budget spending, even as economic growth has strengthened. In addition to maintaining general government debt (excluding debt held by the government-owned pension fund) at more than 60% of GDP--which is above the 'A' median of 35% and
