Research Update: State of Minas Gerais 'CCC+' Global And 'brBB' National Scale Ratings Affirmed; Outlook Remains Stable

The Brazilian state of Minas Gerais is edging closer to formally joining the Fiscal Recovery Regime (FRR), which would provide legal certainty on continuity of debt relief and support its fiscal consolidation. The state's challenging fiscal profile has marginally improved, but projected to weaken over the next few years amid a gradual rise in debt service costs (according to the FRR terms) until fiscal adjustment measures take hold. We affirmed our 'CCC+' global scale and 'brBB' national scale ratings on Minas Gerais. The outlook remains stable, reflecting our view that the state will benefit from debt relief that will enable it to avoid default given its structurally weak fiscal position. On Oct. 14, 2024, S&P Global Ratings affirmed its long-term

...- The Brazilian state of Minas Gerais is edging closer to formally joining the Fiscal Recovery Regime (FRR), which would provide legal certainty on continuity of debt relief and support its fiscal consolidation. - The state's challenging fiscal profile has marginally improved, but projected to weaken over the next few years amid a gradual rise in debt service costs (according to the FRR terms) until fiscal adjustment measures take hold. - We affirmed our '###+' global scale and 'brBB' national scale ratings on Minas Gerais. - The outlook remains stable, reflecting our view that the state will benefit from debt relief that will enable it to avoid default given its structurally weak fiscal position....

Research Update