On Dec. 5, 2016, the Brazilian state of Minas Gerais declared financial emergency, as it's struggling to stabilize its finances and comply with the Fiscal Responsibility Law's (FRL) targets. Although the state was able to implement some measures to stem its fiscal deterioration, we deem its cost-control measures as still insufficient and its financial management as weakening, with increasing questions over its capacity and willingness to make full and timely payments on its financial obligations in the next 12 months. We're lowering our global scale rating to 'B-' from 'BB-' and our national scale rating to 'brB-' from 'brA' on the state. The negative outlook on the state reflects its sagging financial management and our view that Minas Gerais will
