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Rising fears for possible downgrade in sovereign rating

The Finance Ministry is fretting about a possible downgrade in the sovereign rating, following negative consequences on the economy in light of political conflicts.



According to an official who asked for anonymity, Moody’s Investors Service and Fitch Ratings conducted conference calls with Thai officials last week, to get data needed for the annual review.

On the row between the government and rice farmers, they understood that it is just a "technical" default on debt to farmers as a result of political conflicts.

"I’m not sure if the rating agencies would revise down the outlook from stable to negative. Still, economic indicators remain positive," he said.

The review is expected to be announced in the next 1-2 months.

He noted that without a new government, public spending projects are delayed and this also affects private investment and consumption.


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