Ongoing debt relief and one-off revenue this year have enabled the State of Minas Gerais to service its debt on a timely basis, although underlying fiscal and liquidity vulnerabilities remain key rating constraints. We assume the newly elected state administration will maintain the commitments under the Programa de Pleno Pagamento de DÃvidas dos Estados (Propag), which provides debt relief from the federal government in exchange for policies to limit spending. We affirmed our'B-'global scale issuer credit rating on Minas Gerais. The outlook remains stable and indicates our view that the state will continue to benefit from debt relief and avoid default, while modest fiscal improvement will allow the state to increase debt payments under the debt-relief program. On
