The rating on Kazakhstan Electricity Grid Operating Co. (JSC) (KEGOC), the fully state-owned monopoly operator of the Republic of Kazakhstan's (foreign currency BB+/Stable/B; local currency BBB-/Stable/A-3) high-voltage electricity transmission grid, reflects: The business risks associated with its relatively high concentration of generators and consumers in the electricity sector of Kazakhstan; its aggressive financial policy; and the expected deterioration of its financial flexibility from 2004-2005, when it starts to repay the principal on its long-term loans. These concerns are offset at this rating level by KEGOC's strategic importance to, and consequent support from, central government. The company's monopoly position in electricity transmission in Kazakhstan and supportive regulation are also positive rating factors. KEGOC operates a total of 23,520 km of high-voltage
