S&P revises outlook on Belarus to positive

Standard & Poor's Ratings Services on April 17 revised its outlook on Belarus' ratings to positive from stable and affirmed its long- and short-term sovereign credit ratings on the country at 'B-' and 'B', respectively, BelaPAN said.

The international credit ratings agency noted the country's strengthening economic stability, which it said was the result of tightened monetary and fiscal policies.

"The outlook revision reflects the possibility of an upgrade if Belarus' high inflation continues to decline, its current account deficit remains fairly narrow in the face of a strengthening economy, and its fiscal spending is contained," S&P said in a statement.

"We could revise the outlook back to stable if renewed expansionary policies - for example, in the run-up to presidential elections in 2015 - lead to the return of exchange rate and inflationary pressures."

The agency said that the ratings could be constrained by political risks, high government financing needs, and a reliance on external funding.

Minsk's reluctance to conduct structural reforms to improve competitiveness and growth prospects is also a key ratings weakness, according to the statement.

S&P said that it expected Belarus' GDP growth not to surpass three percent this year, while inflation was forecast at 22 percent and the country's current account deficit was projected to widen from three to six percent of GDP.