Rating Outlook And Trends

The average credit quality in Latin America and Americas island nations is at its highest point since March 2017. But the regional average rating weighted by GDP has barely recovered to its 2019 level. This is a result of improving credit quality at the lower end of the ratings scale and a slower recovery among the region's biggest economies.

Since 2021, S&P Global Ratings has raised its ratings on eight Latin American sovereigns. Seven of these were speculative-grade sovereigns, and none of them moved into investment-grade after the upgrades. The main drivers of the upgrades were fiscal and debt scores, which improved in six out of the eight sovereigns.

The credit quality of the region is likely to rise further, as the number of positive outlooks in the Americas is at its highest since 2011. (The sovereigns with positive outlooks are mainly small Caribbean and Central American countries.) As a result, the difference between the simple average credit quality and the GDP weighted credit quality is likely to narrow (see chart 1).

Average ratings in Latin America and Americas island nations have slowly approached the middle point between 'BB' and 'BB+' this year. Average creditworthiness in all the Americas, including the large economies of Canada and the U.S., is close to 'BB+'. The GDP-weighted average is slightly above 'AA-', indicating the significant weight of these two North American economies on the continent's overall credit quality. 

Note that the ratings we reference throughout this article are foreign currency sovereign credit ratings.

In the Americas, currently 17 sovereigns are rated below 'BBB-'. However, since year-end 2020, the distribution of these speculative-grade ratings has shifted up, with fewer sovereigns in the 'B' and 'CCC' and below categories and more in the 'BB' category.

The share of sovereigns in the speculative-grade category that are rated 'BB' is almost 50%, its highest since 2015, while the number of sovereigns rated 'B' and 'CCC' and below is at its lowest in a decade. Since December 2023, we have had no sovereigns in selective default--Suriname was the last sovereign we upgraded from 'SD'. The last time there was a period with no sovereigns rated 'SD' was in 2017.

We rate 14 of the 31 sovereigns in the Americas 'BBB-' or higher, or investment-grade (see chart 2). The share of investment-grade sovereigns in the Americas is lower than the world average, which is 55%. The region's highest-rated sovereigns are Canada ('AAA') and the U.S. ('AA+'), followed by Bermuda ('A+'), the Falkland Islands ('A+'), and Chile ('A').

The lowest rated are Argentina ('CCC'), Bolivia ('CCC+'), and Suriname ('CCC+').

Rating Actions In 2024 

In the first half of 2024, we lowered the long-term foreign currency ratings on one sovereign and raised the ratings on two:

• In February, we raised the rating on Paraguay to 'BB+' from 'BB'.  
• In March, we raised the rating on Argentina to 'CCC' from 'CCC-'.
• In April, we lowered the rating on Peru to 'BBB-' from 'BBB'.  

In the second half of 2024, we lowered the long-term foreign currency ratings on one sovereign and raised the ratings on two:

• In October, we raised the rating on Nicaragua to 'B+' from 'B'.
• In November, we raised the rating on Barbados to 'B' from 'B-'.
• In November we lowered the rating on Panama to 'BBB-' from 'BBB'.

In addition, we revised the outlooks on Aruba, Costa Rica, Guatemala, Jamaica, and Turks and Caicos to positive from stable. As a result, there are now six sovereigns in the region with positive outlooks (the sixth is Barbados) (see chart 3). We also revised the outlooks on Colombia, Ecuador, and Honduras to negative from stable.

Table 1

Americas--Sovereign rating strengths and weaknesses
Issuer	Sovereign foreign currency ratings	Institutional assessment	Economic assessment	External assessment	Fiscal assessment, budget performance	Fiscal assessment, debt	Monetary assessment
Argentina	CCC/Stable/C	6	5	6	6	5	6
Aruba	BBB/Positive/A-2	2	4	4	1	4	4
Bahamas	B+/Stable/B	4	4	6	3§	6	4
Barbados	B/Positive/B	5	4	6	3§	6	5
Belize	B-/Stable/B	6	5§	6	6	5	5
Bermuda	A+/Stable/A-1	2	2	3	1	4	5
Bolivia	CCC+/Negative/C	5	6	6	6	5	5
Brazil	BB/Stable/B	4	5	2	6	6	3
Canada	AAA/Stable/A-1+	1	1	2	1	3	1
Chile	A/Stable/A-1	2	4	4	2§	2	2
Colombia	BB+/Negative/B	3	4	5	4	4	3
Costa Rica	BB-/Positive/B	4	4	4	5	6	4
Curacao	BBB-/Stable/A-3	3	5	2	2	1	5
Dominican Republic	BB/Stable/B	4	3	4	5	5	4
Ecuador	B-/Negative/B	6	5	6	4	3	6
El Salvador	B-/Stable/B	6	5	5	6	6	6
Falkland Islands	A+/Stable/A-1	3	2	4	1	1	6
Guatemala	BB/Positive/B	4	5	2	3	3	4
Honduras	BB-/Negative/B	5	5	2	5	3§	5*
Jamaica	BB-/Positive/B	4	6	4	1	5	4
Mexico	BBB/Stable/A-2	3	5	2	4	4	3
Montserrat	BBB-/Stable/A-3	2	5	3	4	1	5
Nicaragua	B+/Stable/B	5	5	4§	3§	2	5
Panama	BBB-/Stable/A-3	3	2	5	3	5*	5
Paraguay	BB+/Stable/B	4	4	2	3	3	5
Peru	BBB-/Stable/A-3	4	4	3	2	3	3
Suriname	CCC+/Stable/C	6	6	6	6	6	6
Trinidad and Tobago	BBB-/Stable/A-3	3	4	3	3	4	4
Turks and Caicos	BBB+/Positive/A-2	2	4	3	1	1	6
U.S.	AA+/Stable/A-1+	2	1	2	5	6	1
Uruguay	BBB+/Stable/A-2	3	3	2	5	3	5
1 (%)		3.2	6.5	0.0	19.4	12.9	6.5
2 (%)		19.4	9.7	29.0	9.7	6.5	3.2
3 (%)		22.6	6.5	16.1	22.6	22.6	12.9
4 (%)		25.8	32.3	22.6	12.9	16.1	22.6
5 (%)		12.9	35.5	9.7	16.1	19.4	35.5
6 (%)		16.1	9.7	22.6	19.4	22.6	19.4
Median		4.0	4.0	4.0	4.0	4.0	5.0
Mean		3.7	4.1	3.8	3.7	3.9	4.3
Standard deviation		1.4	1.4	1.6	1.9	1.7	1.4
*Deterioration since June 2024. §Improvement since June 2024. Source: S&P Global Ratings.

Table 2

Americas--Economic outlook
	--Real GDP growth (%)--		--GG balance/GDP (%)--		--Net GG debt/GDP (%)--		--Current account balance/GDP (%)--		--Narrow net external debt/CAR (%)--
	2024	2025	2024	2025	2024	2025	2024	2025	2024	2025
Argentina	-3.51	3.79	0.00	-0.25	67.42	66.86	0.40	-0.03	190.48	171.00
Aruba	2.00	0.50	3.26	2.51	39.50	36.74	7.46	7.81	-1.25	0.95
Bahamas	1.80	1.50	-1.70	-1.29	70.34	68.73	-6.67	-6.35	41.62	42.13
Barbados	3.70	2.00	-1.20	-0.80	100.90	97.98	-6.50	-6.21	71.09	74.32
Belize	3.70	2.50	-2.50	-2.50	65.13	64.78	-2.88	-2.66	61.47	61.79
Bermuda	3.00	1.10	0.00	0.10	4.38	3.79	11.16	11.32	-72.81	-74.10
Bolivia	1.80	1.50	-9.90	-9.30	68.18	73.89	-1.79	-1.59	104.17	111.62
Brazil	3.07	1.86	-5.90	-5.60	59.83	62.84	-2.55	-2.12	5.99	2.06
Canada	1.19	1.67	-1.65	-1.45	47.39	47.28	-0.35	-0.53	103.98	115.35
Chile	2.38	2.22	-2.00	-1.30	32.87	32.99	-2.10	-1.77	79.58	74.52
Colombia	1.70	2.49	-5.60	-5.10	56.73	58.17	-2.34	-3.34	119.35	125.66
Costa Rica	4.00	3.30	-3.60	-3.30	61.32	62.32	-1.96	-2.29	26.29	25.05
Curacao	4.00	2.00	-1.40	-1.63	-28.05	-26.40	-21.82	-20.82	-58.66	-58.21
Dominican Republic	5.00	5.00	-4.22	-3.98	56.46	56.91	-3.02	-2.99	75.29	72.98
Ecuador	0.50	1.20	-2.30	-2.50	53.29	54.38	4.23	2.76	111.05	108.30
El Salvador	2.50	2.40	-4.39	-4.18	75.34	76.67	-2.03	-1.81	72.84	72.05
Falkland Islands	2.00	2.00	-12.81	-12.12	-142.63	-128.23	N/A	N/A	N/A	N/A
Guatemala	3.50	3.50	0.40	-2.10	14.10	15.31	1.19	-0.42	-14.45	-14.34
Honduras	3.40	3.00	-2.30	-2.30	37.51	38.93	-4.16	-3.65	23.67	26.62
Jamaica	-1.45	4.20	0.32	0.59	55.65	51.67	0.44	-0.83	58.08	60.15
Mexico	1.48	1.24	-5.60	-4.20	50.07	52.30	-1.22	-1.27	27.96	29.15
Montserrat	3.00	2.00	0.00	0.00	-1.14	-0.81	-13.45	-11.78	-138.45	-136.48
Nicaragua	3.80	3.50	0.17	0.16	35.70	33.45	3.61	1.41	42.92	34.42
Panama	3.00	3.80	-6.00	-4.00	46.51	47.93	-2.63	-2.88	107.96	106.61
Paraguay	4.00	3.50	-2.70	-2.20	29.98	30.28	-2.63	-3.34	39.15	39.01
Peru	2.87	2.76	-3.50	-2.50	23.15	24.35	1.14	0.80	34.13	33.61
Suriname	3.00	3.00	-0.99	-0.08	77.99	71.36	2.17	1.83	35.02	36.44
Trinidad and Tobago	0.32	0.37	-3.80	-4.14	27.64	31.01	7.48	6.44	-39.72	-33.71
Turks and Caicos	4.80	4.70	1.21	1.30	-47.65	-45.51	24.85	23.80	-99.19	-96.26
U.S.	2.72	1.96	-6.26	-6.02	93.11	95.31	-3.44	-3.73	358.04	371.57
Uruguay	3.10	2.40	-3.20	-3.20	54.16	55.87	-1.05	-1.21	13.36	16.83
GG--General government. CAR--Current account receipts. Source: S&P Global Ratings.

Facing Uncertainty On Trade, Immigration Policies Under A Trump Administration

The election of Donald Trump could unleash political and economic changes throughout the Americas, creating potential opportunities and challenges for various countries. S&P Global Ratings economists expect the U.S. economy to maintain robust growth, with GDP expanding 2% in the next two years after growing 2.7% in 2024, providing a favorable context for the rest of the Americas.

However, the region faces greater uncertainty over new trade barriers, restrictions on immigration (which may affect remittances and economic performance in some countries), and a redirection of global capital flows (including portfolio outflows from emerging markets into the U.S.) and FDI flows due to political factors. Moreover, U.S. tensions with China could have repercussions on the global economy if slower GDP growth in China results in weaker commodity prices and worsening export prospects for countries in South America.

Trade is becoming a more prominent issue throughout the region owing to:

• Ongoing shifts in global production chains,
• Proposals by the incoming Trump administration to impose more trade barriers against various countries (especially China, Canada, and Mexico), and
• The recent announcement of a new trade deal between the EU and the countries of Mercosur (Brazil, Argentina, Paraguay, and Uruguay).

Ratification of the new trade deal may be delayed by opposition from countries such as France and Italy over concerns about the impact on their agricultural sectors.

Much of Latin America has a minor presence in global production chains, likely limiting the direct economic impact of shifting global supply chains. However, several countries, such as Mexico and some Central American countries, have a greater presence in such chains, highlighting both the risks and potential gains.

Mexico receives 50% of all foreign direct investment (FDI) in manufacturing in Latin America, auguring well for future exports despite trade tensions. Over a longer time, Mexico has been receiving a higher share of FDI going to emerging market countries, mainly because of the ease of commerce with the U.S. Mexico now receives around 10% of all FDI going to emerging market countries, compared with 6%, on average, during the 2010s.

IMF studies indicate that Mexican companies are more integrated than ever into global value chains tied to the U.S. market. Net exports to the U.S. from Mexican companies that are located within such production chains increased following the introduction of U.S. tariffs on China in 2018.

The smaller economies of Costa Rica (BB-/Positive/B) and the Dominican Republic (BB/Stable/B) have both attracted more FDI (as a percent of their GDP) than Mexico in recent years. In Costa Rica, FDI inflows averaged 4.4% of GDP during 2021-24. Much of the money has gone to free-trade zones that are creating potential upside for the country's external performance as it consolidates as a high-tech manufacturing and services hub. FDI has also been high in the Dominican Republic, averaging 3.6% of GDP during 2021-24, boosting growth and deepening trade links with the U.S. and other markets. Both countries could gain from shifting trade and investment patterns based on nearshoring.

Country Highlights

U.S. (AA+/Stable/A-1+).  The U.S. will soon enter a period of Republicans controlling the presidency and both chambers of Congress. Congress is likely to raise or suspend the U.S. government debt ceiling, which comes into effect in January. In addition, a package of large tax cuts approved under then-President Trump's first administration is scheduled to expire in 2025. The cuts are likely to be extended, after some revisions.

These developments, plus President-elect Trump's plans for new tax measures, could result in important changes in fiscal and other policies. The Trump administration will actively use trade policy to pursue economic and political goals, such as limiting immigration or developing strategic sectors of the economy.

Canada (AAA/Stable/A-1+).  The Liberal Party of Prime Minister Justin Trudeau has faced falling popularity and the loss of formal support in Parliament from a left-wing party whose votes provided a majority that allowed the Liberals to govern. National elections are due next year. These political developments have not materially affected fiscal trends.

However, Canada's political leadership has not focused much in recent years on factors that have resulted in mediocre long-term GDP growth. The gap in per capita income between Canada and the U.S. has been growing for many years, despite strong economic integration and political stability (the same can be said of Mexico) (see chart 5). The risk of potential U.S. trade barriers on Canadian exports could reinforce Canada's comparatively modest rate of productivity and GDP growth.

Argentina (CCC/Stable/C).  Economic stabilization in Argentina continues. Inflation has fallen from a 25.5% monthly rate in December 2023 to 2.4% in November 2024, and the government has run a fiscal surplus of 0.5% of GDP.

There are signs that the economy may have begun to recover after contracting in the first half of this year. Real wages have started to rise, and many companies have been able to issue debt in global capital markets. The gap between the official and parallel exchange rates has narrowed from around 60% at the beginning of the year toward 10% in recent weeks.

However, a higher rating depends on sustaining and deepening these positive trends. Argentina remains vulnerable to default because of the magnitude of fiscal, monetary, exchange rate, political, and other challenges. The sovereign has negative net foreign exchange reserves and lacks access to international capital markets but will need to make external debt payments of over $17 billion in 2025 ($8.9 billion to commercial creditors and $8.1 billion to official creditors, including $3.3 billion in interest to the IMF).

Brazil (BB/Stable/B).  GDP growth in Brazil may decelerate toward 1.9% in 2025, from 3.1% in 2024 and an average annual rate of 3% in the previous two years. However, inflation is likely to remain above 4% in 2025, leading the central bank to keep its policy interest rate high (after raising it in early December to 12.25%). The high rates partly reflect concerns about economic management, following the recent announcement of spending control measures that were badly received by the market.

The government presented a series of cost-containment measures, increased tax rates for higher-income earners, and a higher income threshold for paying income taxes. The package, designed to contain the fiscal deficit and stabilize the government's debt burden, is likely to have a modest impact. Despite the recent pickup in growth, fiscal challenges remain constraints on the rating.

The political situation has recently become more uncertain ahead of national elections in 2026. Former President Bolsonaro has been charged with alleged participation in an aborted coup attempt in 2022, along with some retired generals. The charges, which could prevent him from running in the next presidential elections, have raised political tensions.

Colombia (BB+/Negative/B).  In Colombia, political challenges have delayed the fiscal adjustment that is needed to stay within the deficit parameters of the country's fiscal rule in 2024 and in 2025, as the government struggles to make substantial spending cuts. A delay in Congressional approval of the 2025 budget, which may otherwise be passed by a presidential decree, reflects rising tensions between President Gustavo Petro and Congress. The central government fiscal deficit may exceed 5% of GDP in 2024 and could stay above 4% in 2025.

Congress is also debating a constitutional reform to substantially boost the transfer of funds from the central to local governments as a step toward decentralizing the public sector. The proposed changes, designed to be phased in over 12 years, are slated to come into effect only after the central government transfers some of its spending obligations to local governments, thereby matching resources with new tasks. The reform could disrupt fiscal stability, or worsen the quality of public services, unless implemented prudently.

Our negative outlook points to a possible downgrade if economic growth is below our expectations or if unexpected fiscal slippage contributes to weaker public finances.

Mexico (BBB/Stable/A-2).  We recently affirmed our foreign currency rating on Mexico based on our expectation that cautious macroeconomic management, including prudent monetary policy and a return to lower fiscal deficits, will stabilize the sovereign's debt and interest burden over the next two years. We assume that disputes between Mexico and the U.S. on trade, immigration, and other matters will be managed in a pragmatic manner that sustains economic stability and maintains the deep economic integration of the two countries.

Panama (BBB-/Stable/A-3).  We downgraded Panama to 'BBB-' from 'BBB' in November 2024 due to lower flexibility that increases the vulnerability to economic and fiscal challenges ahead. Sluggish revenue growth in 2024, and recognition of earlier payment arrears and of off-budget liabilities have caused Panama's sovereign debt and interest burden to rise. Stable public finances will depend on making a fiscal correction while sustaining high GDP growth. The government is pursuing a reform of the country's financially weak pension system, whose shortfalls will increasingly be filled with fiscal contributions.

Sovereign Summaries

Argentina (CCC/Stable/C)

• Analyst: joydeep.mukherji@spglobal.com
• Latest publication: Argentina 'CCC/C' Global Scale And 'raB+' National Scale Ratings Affirmed; Outlook Remains Stable, Aug. 8, 2024

Rating score snapshot

• Institutional assessment: 6
• Economic assessment: 5
• External assessment: 6
• Fiscal assessment – Flexibility and performance: 6
• Fiscal assessment – Debt burden: 5
• Monetary assessment: 6

Outlook: Stable

The stable outlook on the long-term ratings balances the risks posed by pronounced economic imbalances and other uncertainties with recent progress in making fiscal adjustments, reducing inflation, and undertaking structural reforms to address long-standing microeconomic weaknesses that have contributed to poor economic performance for many years.

Upside scenario.  We could raise the ratings in the next 12 months if we see successful execution of policies that reduce Argentina's major macroeconomic imbalances and vulnerabilities, setting the stage for sustainable fiscal outcomes, lower inflation, and continued economic recovery. In such a scenario, the government would have better access to voluntary capital market funding.

Downside scenario.  We could lower the ratings in the coming 12 months if negative developments undermine Argentina's already limited access to financing. Failure to carefully advance difficult exchange rate, fiscal, monetary, and other reforms could result in instability that could raise the risk of default, which could lead to a downgrade.

Table 3

Argentina
	2018	2019	2020	2021	2022	2023	2024e	2025e	2026e	2027e
GDP per capita (in ‘000)	11.96	10.07	8.58	10.71	13.78	13.92	13.01	13.30	12.80	13.54
GDP growth	-2.62	-2.00	-9.90	10.44	5.27	-1.61	-3.51	3.79	2.46	2.54
GDP per capita growth	-3.70	-3.09	-10.90	9.21	4.10	-2.71	-4.47	2.76	1.44	1.52
Current account balance/GDP	-5.16	-0.78	0.70	1.36	-0.64	-3.24	0.40	-0.03	-0.11	-0.23
Gross external financing needs/CAR&FXR	150.57	133.19	151.43	130.09	136.60	153.62	156.31	143.09	137.11	129.89
Narrow net external debt/CAR	210.41	230.71	274.47	203.20	167.59	222.22	190.48	171.00	168.17	152.00
GG balance/GDP	-5.66	-1.89	-7.73	-4.02	-2.61	-3.62	0.00	-0.25	-0.30	-0.30
GG net debt/GDP	74.83	84.10	95.46	72.18	75.15	145.11	67.42	66.86	64.09	56.91
CPI inflation	34.28	53.55	42.02	48.41	72.43	133.49	226.04	65.02	40.00	32.00
Bank credit to resident private sector/GDP	14.49	11.48	11.85	9.84	9.09	9.78	9.78	9.78	9.78	9.78
e--Estimate.

Aruba (BBB/Positive/A-2)

• Analyst: jennifer.love@spglobal.com
• Latest publication: Aruba Outlook Revised To Positive From Stable On Stronger Economy; 'BBB' Rating Affirmed, March 19, 2024

Rating score snapshot

• Institutional assessment: 2
• Economic assessment: 4
• External assessment: 4
• Fiscal assessment – Flexibility and performance: 1
• Fiscal assessment – Debt burden: 4
• Monetary assessment: 4

Outlook: Positive

The positive outlook reflects a greater than one-in-three chance that we could raise the rating on Aruba over the next 12-24 months. We expect Aruba's economy will remain well above its pre-pandemic level throughout the forecast horizon and that the government will achieve fiscal surpluses, supporting an improvement in its net debt burden and a cooperative relationship with the Netherlands.

Downside scenario.  We could lower our ratings in the next two years if income per capita significantly deteriorates, or if the government reverses the progress it has made on fiscal performance, leading to persistently large government deficits, a higher debt burden, and rising debt costs. If the bilateral relationship between Aruba and the Netherlands were to weaken, signaling an erosion of institutional strength, we could lower the rating by one or more notches.

Upside scenario.  We could raise our ratings within the next two years if the government is able to demonstrate progress on its debt reduction and economic reform plans, which would lead to a strengthened balance sheet and a more resilient economy. This, together with a cooperative relationship with the Netherlands that supports debt sustainability and investor confidence, could lead us to raise our ratings.

Table 4

Aruba
	2018	2019	2020	2021	2022	2023	2024e	2025e	2026e	2027e
GDP per capita (in ‘000)	30.08	31.10	22.85	27.20	30.56	33.97	34.61	35.44	36.29	37.16
GDP growth	2.40	-2.23	-26.21	24.13	8.52	4.26	2.00	0.50	1.00	1.00
GDP per capita growth	2.21	-2.50	-25.80	25.17	8.92	4.17	2.00	0.40	0.90	0.90
Current account balance/GDP	-2.22	0.30	-17.30	-1.09	6.56	5.24	7.46	7.81	8.17	8.53
Gross external financing needs/CAR&FXR	112.61	108.19	141.94	113.97	112.94	106.10	101.83	98.77	100.32	98.32
Narrow net external debt/CAR	-1.36	-1.54	8.23	-3.43	-3.42	-6.40	-1.25	0.95	2.23	3.58
GG balance/GDP	-0.32	4.63	-14.86	-5.38	-1.76	8.76	3.26	2.51	2.56	2.47
GG net debt/GDP	35.85	32.88	60.31	58.53	55.69	42.77	39.50	36.74	33.96	31.28
CPI inflation	3.63	3.60	-3.00	3.61	5.73	2.27	0.10	2.00	1.50	1.50
Bank credit to resident private sector/GDP	55.97	58.79	81.75	67.51	61.36	59.61	59.61	59.61	59.61	59.61
e--Estimate.

The Bahamas (B+/Stable/B)

• Analyst: alexis.smith-juvelis@spglobal.com
• Latest publication: The Commonwealth of The Bahamas 'B+' Long-Term Ratings Affirmed; Outlook Remains Stable, Sept. 25, 2024

Rating score snapshot

• Institutional assessment: 4
• Economic assessment: 4
• External assessment: 6
• Fiscal assessment – Flexibility and performance: 3
• Fiscal assessment – Debt burden: 6
• Monetary assessment: 4

Outlook: Stable

The stable outlook reflects our view that over the next 12 months, a stable economy, combined with fiscal consolidation efforts, will limit the government's debt burden. We expect the domestic market and multilateral lenders will meet the sovereign's relatively large, albeit decreasing, financing needs.

Downside scenario.  We could lower the ratings in the next 12 months if income per capita deteriorates significantly or if the government reverses the progress it has made on fiscal performance, leading to persistently large fiscal deficits. We could also lower the ratings if the sovereign's access to external liquidity were to deteriorate unexpectedly.

Upside scenario.  We could raise the ratings in the next 12 months if the government enacts public finance reform faster than we expect, leading to sustained near-balanced financial results and improved economic prospects. This could result from stronger revenues supported by, among other things, successful implementation of a corporate income tax and carbon credits, combined with improved state-owned enterprise finances after effectively executing energy sector reforms.

Table 5

Bahamas
	2018	2019	2020	2021	2022	2023	2024e	2025e	2026e	2027e
GDP per capita (in ‘000)	32.71	33.42	25.32	29.23	32.92	35.47	36.49	37.32	38.09	38.88
GDP growth	2.63	-1.36	-21.42	15.40	10.78	2.64	1.80	1.50	1.50	1.50
GDP per capita growth	1.60	-2.33	-22.18	16.66	8.01	1.32	0.49	0.20	0.20	0.20
Current account balance/GDP	-9.51	-2.16	-22.94	-21.41	-9.38	-7.56	-6.67	-6.35	-5.98	-5.61
Gross external financing needs/CAR&FXR	263.75	207.98	519.10	340.54	239.60	228.14	209.84	193.31	195.08	196.55
Narrow net external debt/CAR	40.13	22.12	126.86	68.79	47.65	47.33	41.62	42.13	42.55	44.20
GG balance/GDP	-1.80	-6.54	-15.21	-6.96	-4.54	-1.65	-1.70	-1.29	-1.27	-1.26
GG net debt/GDP	47.76	47.27	80.94	78.96	76.79	72.21	70.34	68.73	67.31	65.93
CPI inflation	2.27	2.49	0.04	2.90	5.61	3.05	2.40	2.10	1.90	1.90
Bank credit to resident private sector/GDP	49.63	47.79	59.35	51.02	45.44	42.23	40.86	39.76	38.77	37.80
e--Estimate.

Barbados (B/Positive/B)

• Analyst: jennifer.love@spglobal.com
• Latest publication: Barbados Long-Term Sovereign Ratings Raised To 'B' From 'B-' On Fiscal Reforms; Outlook Is Positive, Nov. 5, 2024

Rating score snapshot

• Institutional assessment: 5
• Economic assessment: 4
• External assessment: 6
• Fiscal assessment – Flexibility and performance: 3
• Fiscal assessment – Debt burden: 6
• Monetary assessment: 5

Outlook: Positive

The positive outlook reflects S&P Global Ratings' expectation that Barbados is likely to make progress in achieving sustained GDP growth while strengthening its public finances, thereby gradually reducing its debt burden. We expect policy continuity and continued reforms beyond the scheduled expiry of the country's current IMF program in 2025.

Downside scenario.  We could revise the outlook to stable over the next 12-18 months in the event of unexpected fiscal setbacks or signals of diminished commitment to the government's long-term strategy to strengthen public finances and reduce its high debt burden. We could also revise the outlook to stable if we believe that the government would face difficulties in getting sufficient funding to meet its fiscal or external financing needs.

Upside scenario.  We could raise our ratings in the next 12 months if continued reform momentum and fiscal adjustment support strengthened GDP growth prospects and stronger public finances. A favorable policy track record could boost investor confidence and improve our view of the sovereign's institutional assessment.

Table 6

Barbados
	2018	2019	2020	2021	2022	2023	2024e	2025e	2026e	2027e
GDP per capita (in ‘000)	19.64	20.17	17.98	18.33	21.62	23.19	24.75	25.75	26.75	27.80
GDP growth	-1.17	0.65	-15.05	-0.25	17.83	4.09	3.70	2.00	2.00	2.00
GDP per capita growth	-1.32	0.52	-15.16	-0.38	17.15	3.97	3.57	1.88	1.88	1.88
Current account balance/GDP	-3.95	-1.60	-4.90	-10.26	-9.86	-8.69	-6.50	-6.21	-5.89	-5.38
Gross external financing needs/CAR&FXR	236.30	193.69	269.48	225.16	204.64	219.86	183.48	208.54	215.66	229.80
Narrow net external debt/CAR	81.08	59.51	76.48	73.20	76.09	78.60	71.09	74.32	76.03	76.59
GG balance/GDP	-0.27	3.38	-4.16	-4.65	-1.93	-1.71	-1.20	-0.80	-0.50	-0.10
GG net debt/GDP	103.49	95.67	109.83	116.02	107.93	105.77	100.90	97.98	94.86	91.36
CPI inflation	3.67	4.10	0.67	1.52	4.28	3.19	3.04	2.09	2.00	2.00
Bank credit to resident private sector/GDP	76.31	74.36	82.63	80.81	70.70	67.44	64.35	63.43	60.96	58.59
e--Estimate.

Belize (B-/Stable/B)

• Analyst: fernanda.nieto@spglobal.com
• Latest publication: Belize 'B-/B' Ratings Affirmed On Projected Moderate Economic Growth; Outlook Remains Stable, Aug. 21, 2024

Rating score snapshot

• Institutional assessment: 6
• Economic assessment: 5
• External assessment: 6
• Fiscal assessment – Flexibility and performance: 6
• Fiscal assessment – Debt burden: 5
• Monetary assessment: 5

Outlook: Stable

The stable outlook reflects Belize's smooth debt service schedule over the next 12-18 months, amid favorable debt conditions. Moreover, it reflects our expectation for continued economic growth alongside the central government's fiscal efforts, which should result in moderately low fiscal deficits and a relatively stable debt trajectory.

Downside scenario.  We could lower the ratings in the next 12-18 months if adverse developments worsen Belize's fiscal performance, leading to a fast buildup of fiscal debt and further weakening Belize's already low usable reserves.

Upside scenario.  We could raise the ratings over the next 12-18 months if Belize achieves faster economic growth, which, along with proper policy implementation, would help improve its highly vulnerable fiscal and external profiles.

Table 7

Belize
	2018	2019	2020	2021	2022	2023	2024e	2025e	2026e	2027e
GDP per capita (in ‘000)	5.83	5.88	4.88	5.62	6.38	6.73	7.00	7.12	7.22	7.32
GDP growth	1.04	4.22	-13.91	17.86	8.69	4.70	3.70	2.50	2.20	2.00
GDP per capita growth	-1.00	1.00	-16.57	14.84	5.68	1.85	0.88	-0.29	-0.58	-0.78
Current account balance/GDP	-6.84	-7.69	-6.23	-6.49	-8.30	-2.95	-2.88	-2.66	-2.54	-2.65
Gross external financing needs/CAR&FXR	136.75	134.64	151.44	143.81	138.85	127.26	131.40	132.41	132.64	132.90
Narrow net external debt/CAR	78.32	80.67	122.92	75.37	54.61	54.19	61.47	61.79	61.72	61.49
GG balance/GDP	-0.86	-3.72	-8.83	-0.23	-0.57	-2.44	-2.50	-2.50	-2.20	-2.00
GG net debt/GDP	71.44	70.62	91.00	69.79	67.02	66.91	65.13	64.78	64.28	63.71
CPI inflation	0.30	0.20	0.10	3.22	6.30	4.40	3.02	2.04	2.09	2.12
Bank credit to resident private sector/GDP	44.91	45.57	54.88	47.54	42.61	41.68	40.58	40.35	40.22	40.16
e--Estimate.

Bermuda (A+/Stable/A-1)

• Analyst: jennifer.love@spglobal.com
• Latest publication: Full Analysis: Bermuda, May 7, 2024

Rating score snapshot

• Institutional assessment: 2
• Economic assessment: 2
• External assessment: 3
• Fiscal assessment – Flexibility and performance: 1
• Fiscal assessment – Debt burden: 4
• Monetary assessment: 5

Outlook: Stable

The stable outlook reflects our expectation that the local economy will remain healthy, and support solid government finances and low debt, as well as Bermuda's external asset position. We believe continued growth will support a balanced budget in line with the government's expectation this year. We assume a commitment to fiscal consolidation will lead to balanced budgets and a slight decrease in net general government debt over the next three years.

Downside scenario.  Unexpected weakness in Bermuda's international financial services sector due to shifts in the global insurance sector, material job losses tied to ongoing sector consolidation, or exogenous shocks could weaken the territory's external asset position, and its public finances. Our fiscal assessment would weaken if the government runs sustained deficits, amid a higher interest burden, or if the government's large liquid assets fall to less than 25% of GDP. Under either scenario, we could lower the rating within the next two years.

Upside scenario.  We could raise the rating if the territory posts more robust real GDP growth on a sustained basis, potentially through greater economic diversification. We could also raise the rating on improvements in Bermuda's debt profile, namely on a lower interest burden or less vulnerable composition of debt. However, we believe that such a scenario will likely take longer than our two-year outlook horizon.

(Last research update published on Aug. 12, 2020)

Table 8

Bermuda
	2018	2019	2020	2021	2022	2023	2024e	2025e	2026e	2027e
GDP per capita (in ‘000)	112.28	117.45	105.43	111.57	118.96	127.89	135.05	138.97	143.61	147.92
GDP growth	-0.43	0.31	-6.84	5.42	6.43	4.00	3.00	1.10	1.13	1.10
GDP per capita growth	-0.43	0.32	-6.81	5.81	6.61	4.10	3.10	1.20	1.23	1.20
Current account balance/GDP	13.18	10.97	12.67	13.53	14.99	14.89	11.16	11.32	11.19	10.77
Gross external financing needs/CAR&FXR	319.28	208.87	225.29	189.25	172.58	162.08	171.70	169.79	169.43	169.84
Narrow net external debt/CAR	-57.34	-55.97	-83.22	-80.36	-58.36	-62.13	-72.81	-74.10	-77.16	-79.87
GG balance/GDP	-1.72	-4.61	-5.96	-3.50	-3.04	-0.50	0.00	0.10	0.25	0.30
GG net debt/GDP	0.56	1.43	3.11	4.66	7.07	4.55	4.38	3.79	3.05	2.42
CPI inflation	1.39	0.93	-0.02	1.52	3.89	3.39	2.50	1.70	2.10	1.80
Bank credit to resident private sector/GDP	110.34	116.43	128.05	122.77	119.43	104.71	99.73	97.48	94.89	92.66
e--Estimate.

Bolivia (CCC+/Negative/C)

• Analyst: victor.santana@spglobal.com
• Latest publication: Bolivia 'CCC+/C' Ratings Affirmed; Outlook Remains Negative, Oct. 4, 2024

Rating score snapshot

• Institutional assessment: 5
• Economic assessment: 6
• External assessment: 6
• Fiscal assessment – Flexibility and performance: 6
• Fiscal assessment – Debt burden: 5
• Monetary assessment: 5

Outlook: Negative

The negative outlook reflects the risk of Bolivia's external profile worsening further, leading to impairment of the government's ability to fully service its debt over the next 18 months.

A political stalemate limits the country's capacity to reverse the erosion of its external liquidity and fiscal position, posing risks to economic and monetary stability. The stalemate has intensified, narrowing the margin for addressing economic policy challenges.

Downside scenario.  We could lower the ratings in the next 12 months if we see a greater risk to debt servicing. In addition, we could consider a debt exchange or restructuring as distressed and tantamount to a default at such a low rating level.

Upside scenario.  We could raise the ratings in the next 12 months if there are decisive policies that improve Bolivia's external liquidity and point to a more sustainable fiscal profile. Addressing the deterioration of macroeconomic imbalances would be an initial step toward improving investor confidence and gaining better access to external debt markets.

Table 9

Bolivia
	2018	2019	2020	2021	2022	2023	2024e	2025e	2026e	2027e
GDP per capita (in ‘000)	3.55	3.55	3.14	3.41	3.67	3.71	3.99	4.13	3.92	3.61
GDP growth	4.22	2.22	-8.74	6.11	3.61	3.08	1.80	1.50	2.50	2.50
GDP per capita growth	2.65	0.80	-10.03	4.64	2.19	1.70	0.47	0.20	1.00	1.00
Current account balance/GDP	-4.28	-3.34	-0.04	3.92	2.13	-2.76	-1.79	-1.59	-1.14	-1.41
Gross external financing needs/CAR&FXR	66.99	69.33	65.60	69.04	82.85	94.66	103.11	102.13	101.75	103.43
Narrow net external debt/CAR	-2.41	36.30	72.82	57.58	58.42	89.66	104.17	111.62	133.68	150.60
GG balance/GDP	-5.97	-6.91	-13.07	-8.46	-5.83	-9.69	-9.90	-9.30	-8.60	-8.10
GG net debt/GDP	24.78	28.96	45.95	52.22	55.17	63.47	68.18	73.89	81.00	86.26
CPI inflation	2.27	1.84	0.94	0.74	1.75	2.58	7.00	7.00	7.00	7.00
Bank credit to resident private sector/GDP	61.31	65.28	75.88	71.54	70.87	68.91	67.06	65.45	63.85	62.30
e--Estimate.

Brazil (BB/Stable/B)

• Analyst: manuel.orozco@spglobal.com
• Latest publication: Full Analysis: Brazil, June 11, 2024

Rating score snapshot

• Institutional assessment: 4
• Economic assessment: 5
• External assessment: 2
• Fiscal assessment – Flexibility and performance: 6
• Fiscal assessment – Debt burden: 6
• Monetary assessment: 3

Outlook: Stable

The stable outlook reflects S&P Global Ratings' expectation that Brazil will maintain a strong external position, thanks to strong commodity output and limited external financing needs. We also believe Brazil's institutional framework can sustain stable and pragmatic policymaking based on extensive checks and balances across the executive, legislative, and judicial branches of government. We expect a very gradual fiscal correction but anticipate fiscal deficits will remain large.

Downside scenario.  We could lower our ratings within the next two years if poor policy implementation leads to further fiscal deterioration and a higher-than-expected debt burden. A deterioration in policy signaling could also lower foreign direct investment inflows and, thereby, weaken Brazil's external position.

Upside scenario.  We could raise our ratings over the next two years if benefits from the now extensive set of structural and microeconomic reforms improve Brazil's long-term growth trajectory. Faster-than-expected progress at addressing fiscal imbalances that stabilizes debt levels could also lead us to raise the ratings.

(Last research update published on Dec. 19, 2023)

Table 10

Brazil
	2018	2019	2020	2021	2022	2023	2024e	2025e	2026e	2027e
GDP per capita (in ‘000)	9.30	9.03	7.07	7.97	9.28	10.29	10.32	10.32	10.82	11.49
GDP growth	1.78	1.22	-3.28	4.76	3.02	2.91	3.07	1.86	2.07	2.21
GDP per capita growth	1.09	0.56	-3.84	4.32	2.65	2.50	2.50	1.32	1.55	1.69
Current account balance/GDP	-2.81	-3.47	-1.69	-2.42	-2.09	-1.13	-2.55	-2.12	-2.23	-1.70
Gross external financing needs/CAR&FXR	67.31	70.05	65.34	70.75	73.47	74.08	77.58	76.78	77.40	76.73
Narrow net external debt/CAR	-9.22	-6.46	-11.54	-0.55	5.99	8.41	5.99	2.06	-1.40	-7.50
GG balance/GDP	-6.90	-4.92	-11.75	-2.24	-3.53	-7.50	-5.90	-5.60	-5.80	-5.80
GG net debt/GDP	56.41	54.36	66.67	56.11	51.42	57.07	59.83	62.84	65.93	68.88
CPI inflation	3.66	3.74	3.21	8.29	9.34	4.60	4.32	4.17	3.72	3.52
Bank credit to resident private sector/GDP	46.62	47.04	52.85	51.95	53.19	53.26	53.50	54.46	55.55	56.69
e--Estimate.

Canada (AAA/Stable/A-1+)

• Analyst: jennifer.love@spglobal.com
• Latest publication: Full Analysis: Canada, Oct. 30, 2024

Rating score snapshot

• Institutional assessment: 1
• Economic assessment: 1
• External assessment: 2
• Fiscal assessment – Flexibility and performance: 1
• Fiscal Assessment – Debt burden: 3
• Monetary assessment: 1

Outlook: Stable

The stable outlook reflects S&P Global Ratings' view that Canada's high wealth levels, diversified economy, fiscal and monetary buffers, and strong external profile underpin creditworthiness and leave the country well positioned to face unforeseen economic shocks.

Downside scenario.  We could lower the ratings over the next two years if Canada's fiscal or debt position weakened substantially, absent policy signals from the government about future corrective actions, and this was accompanied by unexpected poor economic performance. We could also lower the ratings should the fiscal position weaken significantly in tandem with a substantial and sustained deterioration in Canada's net external position, increasing external vulnerabilities.

(Last research update published on April 28, 2022)

Table 11

Canada
	2018	2019	2020	2021	2022	2023	2024e	2025e	2026e	2027e
GDP per capita (in ‘000)	46.54	46.35	43.54	52.89	56.26	54.22	53.77	54.35	58.36	61.39
GDP growth	2.74	1.91	-5.04	5.95	4.19	1.53	1.19	1.67	1.96	1.70
GDP per capita growth	1.28	0.43	-6.06	5.37	2.33	-1.38	-1.76	0.86	1.76	1.09
Current account balance/GDP	-2.38	-1.95	-2.02	-0.02	-0.30	-0.63	-0.35	-0.53	-0.49	-0.42
Gross external financing needs/CAR&FXR	150.91	154.91	177.20	189.18	181.37	173.49	191.17	171.40	173.22	180.96
Narrow net external debt/CAR	115.26	116.06	126.40	100.21	87.82	88.89	103.98	115.35	120.35	127.74
GG balance/GDP	1.19	0.68	-10.80	-1.48	1.06	-0.08	-1.65	-1.45	-1.15	-0.90
GG net debt/GDP	40.30	38.64	53.27	49.91	48.31	47.07	47.39	47.28	46.74	46.10
CPI inflation	2.24	1.96	0.72	3.40	6.80	3.88	2.38	1.88	2.02	1.92
Bank credit to resident private sector/GDP	173.87	175.23	192.38	181.74	173.10	175.07	175.81	176.18	176.05	176.38
e--Estimate.

Chile (A/Stable/A-1)

• Analyst: constanza.perez.aquino@spglobal.com
• Latest publication: Chile Outlook Revised To Stable On Improved Fiscal Trajectory; 'A/A-1' Foreign Currency Ratings Affirmed, Oct. 15, 2024

Rating score snapshot

• Institutional assessment: 2
• Economic assessment: 4
• External assessment: 4
• Fiscal assessment – Flexibility and performance: 2
• Fiscal assessment – Debt burden: 2
• Monetary assessment: 2

Outlook: Stable

The stable outlook assumes that the combination of economic growth and revenue measures will contribute to continued fiscal consolidation, including below-the-line items, that will stabilize net general government debt. We expect continuity in fiscal and monetary policy, indicating Chile's institutional stability.

Downside scenario.  We could lower our ratings over the next 24 months if political impasse stalls policy implementation and hinders economic growth. Stark fiscal deterioration due to weak growth or expansive fiscal policy that leads to a consistent buildup of government debt could also lead to a downgrade.

Upside scenario.  We could raise our ratings if economic growth prospects strengthen from effectively implementing policy. Stronger growth, adding to cautious fiscal management, could help Chile regain fiscal and external buffers that recently declined following the pandemic and earlier social upheaval.

Table 12

Chile
	2018	2019	2020	2021	2022	2023	2024e	2025e	2026e	2027e
GDP per capita (in ‘000)	15.77	14.56	13.01	16.03	15.23	16.83	16.10	16.54	17.58	18.64
GDP growth	4.03	0.54	-6.37	11.55	2.09	0.30	2.38	2.22	2.41	2.53
GDP per capita growth	2.19	-1.33	-8.06	10.31	1.32	-0.37	1.70	1.54	1.73	1.85
Current account balance/GDP	-4.49	-5.21	-1.96	-7.28	-8.66	-3.54	-2.10	-1.77	-1.51	-1.04
Gross external financing needs/CAR&FXR	123.57	126.24	127.28	128.71	121.49	126.86	115.29	111.26	108.55	105.54
Narrow net external debt/CAR	45.59	60.52	76.74	87.01	79.90	85.27	79.58	74.52	65.82	56.91
GG balance/GDP	-1.48	-2.73	-7.12	-7.53	1.36	-2.27	-2.00	-1.30	-1.20	-1.00
GG net debt/GDP	13.02	15.34	22.31	30.54	29.27	31.55	32.87	32.99	32.82	32.59
CPI inflation	2.43	2.55	3.05	4.52	11.64	7.58	4.25	4.01	3.69	3.53
Bank credit to resident private sector/GDP	81.96	87.34	88.51	81.04	82.62	79.81	76.48	76.61	76.41	76.62
e--Estimate.

Colombia (BB+/Negative/B)

• Analyst: manuel.orozco@spglobal.com
• Latest publication: Colombia Outlook Revised To Negative On Subdued Economic Growth Prospects; 'BB+/B' Foreign Currency Ratings Affirmed, Jan. 18, 2024

Rating score snapshot

• Institutional assessment: 3
• Economic assessment: 4
• External assessment: 5
• Fiscal assessment – Flexibility and performance: 4
• Fiscal assessment – Debt burden: 4
• Monetary assessment: 3

Outlook: Negative

We expect broad continuity in fiscal and monetary policies within a stable political environment. Our outlook is negative because potentially persistently weak investor confidence--that affects private-sector investment--may pose risks to our expectation that GDP growth will return to its trend rate of just above 3% in the next couple of years. Low economic growth may indicate less economic resilience and could, absent corrective measures, contribute to fiscal slippage or higher external vulnerabilities.

Downside scenario.  We could downgrade Colombia during the next two years if economic growth is below our expectations. We could also lower the rating if larger-than-expected current account deficits worsen Colombia's already weak external profile or if unexpected fiscal slippage contributes to weaker public finances.

Upside scenario.  Conversely, we could stabilize the rating during the next 12-24 months if we perceive less risk to Colombia's expected trend economic growth, likely coupled with policy steps that improve the sovereign's financial profile. A larger and more diverse export sector, helping to reduce external vulnerability and strengthen economic resilience, could help stabilize the rating.

Table 13

Colombia
	2018	2019	2020	2021	2022	2023	2024e	2025e	2026e	2027e
GDP per capita (in ‘000)	6.93	6.54	5.37	6.24	6.69	6.97	7.93	7.73	8.11	8.49
GDP growth	2.56	3.19	-7.19	10.80	7.29	0.61	1.70	2.49	2.83	2.89
GDP per capita growth	0.78	0.81	-8.99	9.33	6.12	-0.44	0.67	1.48	1.84	1.93
Current account balance/GDP	-4.20	-4.58	-3.43	-5.64	-6.14	-2.52	-2.34	-3.34	-3.10	-3.10
Gross external financing needs/CAR&FXR	98.42	100.59	96.75	97.94	106.45	100.04	100.19	97.70	95.98	94.62
Narrow net external debt/CAR	122.33	125.44	179.52	148.61	116.21	130.52	119.35	125.66	123.09	122.07
GG balance/GDP	-2.62	-2.16	-8.25	-8.28	-6.90	-3.87	-5.60	-5.10	-4.00	-4.00
GG net debt/GDP	43.35	45.59	59.35	59.34	57.31	53.27	56.73	58.17	58.52	58.85
CPI inflation	3.24	3.50	2.54	3.49	10.15	11.77	6.67	3.93	3.39	3.08
Bank credit to resident private sector/GDP	50.39	52.41	55.34	51.89	44.67	43.48	41.69	41.68	42.14	43.23
e--Estimate.

Costa Rica (BB-/Positive/B)

• Analyst: karla.gonzalez@spglobal.com
• Latest publication: Costa Rica Outlook Revised To Positive On Potential Improvement In External Profile; 'BB-/B' Ratings Affirmed, Oct. 22, 2024

Rating score snapshot

• Institutional assessment: 4
• Economic assessment: 4
• External assessment: 4
• Fiscal assessment – Flexibility and performance: 5
• Fiscal assessment – Debt burden: 6
• Monetary assessment: 4

Outlook: Positive

The positive outlook reflects the possible further improvements in Costa Rica's external profile over the next 12-24 months and/or potential upside from stronger long-term economic growth.

Upside scenario.  The positive outlook indicates a greater than one-in-three chance that we could raise the rating on Costa Rica over the next 12-24 months if its external position improves beyond our expectations or if long-standing political obstacles to issue cross-border debt are not an impediment for timely access to external financing. We could also raise the rating if nearshoring or friendshoring (focusing on supply chains with geographically closer countries or with geopolitical allies, respectively) materializes into sustained economic growth consistently above peers'.

Downside scenario.  We could revise the outlook to stable over the next 12-24 months if an economic slowdown in Costa Rica's key trading partners, external shocks, or insecurity weighs on its balance-of-payments position and economic performance.

Table 14

Costa Rica
	2018	2019	2020	2021	2022	2023	2024e	2025e	2026e	2027e
GDP per capita (in ‘000)	12.43	12.69	12.17	12.54	13.24	16.39	17.52	17.88	18.37	18.78
GDP growth	2.62	2.42	-4.27	7.94	4.55	5.11	4.00	3.30	3.30	3.30
GDP per capita growth	1.47	1.35	-5.26	6.86	3.57	4.14	2.93	2.24	2.24	2.24
Current account balance/GDP	-2.99	-1.28	-1.01	-3.17	-3.23	-1.45	-1.96	-2.29	-2.50	-2.71
Gross external financing needs/CAR&FXR	101.63	100.35	94.06	105.52	108.17	105.75	100.84	101.68	98.92	98.16
Narrow net external debt/CAR	49.63	44.97	51.62	45.48	38.14	28.56	26.29	25.05	24.41	24.43
GG balance/GDP	-4.89	-5.16	-7.62	-4.60	-2.21	-3.26	-3.60	-3.30	-3.00	-2.80
GG net debt/GDP	51.58	54.76	62.80	63.70	60.66	59.99	61.32	62.32	62.63	62.73
CPI inflation	2.22	2.10	0.72	1.73	8.27	0.53	0.50	1.00	2.00	2.00
Bank credit to resident private sector/GDP	40.50	43.13	50.43	49.49	47.30	44.00	44.00	44.00	44.00	44.00
e--Estimate.

Curacao (BBB-/Stable /A-3)

• Analyst: jennifer.love@spglobal.com
• Last publication: Full Analysis: Curacao, Feb. 15, 2024

Rating score snapshot

• Institutional assessment: 3
• Economic assessment: 5
• External assessment: 2
• Fiscal assessment – Flexibility and performance: 2
• Fiscal assessment – Debt burden: 1
• Monetary assessment: 5

Outlook: Stable

The stable outlook reflects our expectation that discussions with the Netherlands regarding Curacao's liquidity loans, contingent on an agreement related to the resolution of a local financial institution, as well as progress under its country package of reforms, will advance smoothly, limiting the risk of potential political strain. At the same time, we expect the recovery will continue but decelerate over the next several years, as the economy becomes more reliant on tourism.

Downside scenario.  We could lower the ratings over the next two years if we see unexpected weakening or polarization in the political relationship between Curacao and the Netherlands; or signs of slippage in implementing reforms needed to improve the government's fiscal position, affecting financing options or the recovery. We could view disagreement on the arrangement related to debt financing provided by the Netherlands as an erosion in the bilateral relationship. We could also lower the ratings in the medium term if the government's fiscal performance or net debt metrics were significantly weaker than expected, or if there were a persistent decline in the country's net external asset position.

Upside scenario.  We could raise the ratings if Curacao's relationship with the Netherlands improved materially, leading to significant economic, fiscal, or debt management benefits; and we believed that this improvement would not be subject to substantial execution risks associated with potential conditions attached to any revised agreement. We could also raise the ratings if long-term growth materially recovered and was sustainably in line with that of other sovereigns with similar income per capita.

(Last research update published on Feb. 22, 2023)

Table 15

Curacao
	2018	2019	2020	2021	2022	2023	2024e	2025e	2026e	2027e
GDP per capita (in ‘000)	19.20	19.37	16.49	18.14	20.65	21.06	22.27	23.06	23.74	23.76
GDP growth	-2.17	-3.21	-18.04	4.18	7.89	4.20	4.00	2.00	1.50	1.30
GDP per capita growth	-1.13	-1.70	-16.68	5.98	9.44	-0.41	2.77	0.79	0.30	0.10
Current account balance/GDP	-26.68	-17.87	-27.18	-18.57	-26.75	-19.95	-21.82	-20.82	-19.82	-18.82
Gross external financing needs/CAR&FXR	133.53	130.57	140.35	119.03	130.55	111.00	107.39	105.43	102.69	98.90
Narrow net external debt/CAR	-14.56	-25.38	-5.04	-84.25	-50.22	-61.92	-58.66	-58.21	-59.10	-61.69
GG balance/GDP	-7.92	0.73	-16.84	4.29	-6.43	5.00	-1.40	-1.63	-1.81	-1.89
GG net debt/GDP	-24.60	-32.70	-33.71	-37.10	-21.21	-30.13	-28.05	-26.40	-24.78	-23.87
CPI inflation	2.53	2.67	2.20	3.72	7.36	3.60	3.00	2.80	2.70	2.40
Bank credit to resident private sector/GDP	90.33	94.06	112.69	97.35	88.74	84.76	84.45	84.24	84.07	84.01
e--Estimate.

Dominican Republic (BB/Stable/B)

• Analyst: patricio.vimberg@spglobal.com
• Latest publication: Dominican Republic 'BB/B' Ratings Affirmed; Outlook Remains Stable, Dec. 3, 2024

Rating score snapshot

• Institutional assessment: 4
• Economic assessment: 3
• External assessment: 4
• Fiscal assessment – Flexibility and performance: 5
• Fiscal assessment – Debt burden: 5
• Monetary assessment: 4

Outlook: Stable

The stable outlook reflects our expectation that the very dynamic economy and policy continuity in the next 12-18 months will mitigate the risks of moderate fiscal deficits and limited budgetary flexibility.

Downside scenario.  We could lower the ratings in the next 12-18 months if the inability to pass fiscal reforms exacerbates fiscal risks, leading to wider-than-expected government deficits or an increasing debt burden. We could also lower the ratings if medium-term economic growth were to lose momentum.

Upside scenario.  We could raise the ratings in the next 12-18 months if the Dominican Republic improves its fiscal and debt planning, narrowing government deficits, reducing its interest burden, and improving its fiscal flexibility. We could also raise the ratings if the country displays stronger resilience to international shocks, through the buildup of external buffers.

Table 16

Dominican Republic
	2018	2019	2020	2021	2022	2023	2024e	2025e	2026e	2027e
GDP per capita (in ‘000)	8.33	8.59	7.55	8.95	10.59	11.34	11.54	12.02	12.52	13.04
GDP growth	6.98	5.05	-6.72	12.27	4.86	2.36	5.00	5.00	5.00	5.00
GDP per capita growth	5.97	4.12	-7.53	11.34	4.01	1.51	4.13	4.13	4.13	4.13
Current account balance/GDP	-1.54	-1.34	-1.70	-2.85	-5.82	-3.60	-3.02	-2.99	-3.05	-3.07
Gross external financing needs/CAR&FXR	91.47	90.91	90.23	88.98	95.28	90.28	86.75	91.00	92.22	89.45
Narrow net external debt/CAR	78.70	85.21	114.33	82.94	68.49	79.18	75.29	72.98	70.72	68.86
GG balance/GDP	-3.58	-3.42	-9.34	-3.52	-3.77	-4.05	-4.22	-3.98	-3.66	-3.36
GG net debt/GDP	46.08	49.40	65.70	57.36	54.26	55.40	56.46	56.91	57.01	56.80
CPI inflation	3.56	1.81	3.78	8.24	8.81	4.79	3.30	4.00	4.00	4.00
Bank credit to resident private sector/GDP	27.86	28.64	30.13	27.97	28.08	30.72	31.01	31.29	31.58	31.87
e--Estimate.

Ecuador (B-/Negative/B)

• Analyst: carolina.caballero@spglobal.com
• Latest publication: Full Analysis: Ecuador, Aug. 12, 2024

Rating score snapshot

• Institutional assessment: 6
• Economic assessment: 5
• External assessment: 6
• Fiscal assessment – Flexibility and performance: 4
• Fiscal assessment – Debt burden: 3
• Monetary assessment: 6

Outlook: Negative

The negative outlook indicates risks that the policy measures the Ecuadorian authorities implemented may be insufficient to improve fiscal performance and regain market access ahead of a challenging debt service profile starting in 2026. We think manageable commercial debt payments during 2024-2025 and secured funding flows should help contain credit risks.

However, amortization becomes more challenging once principal payments begin on Ecuador's 2030 bond, which it issued in the latest debt restructuring. While the current administration has taken significant steps to reduce the fiscal deficit, the February 2025 elections may delay the implementation of additional policies required to strengthen the fiscal profile and improve investor confidence.

Downside scenario.  We could lower the ratings in the next 12 months if we see a setback in fiscal correction or if support from multilateral and bilateral creditors is more limited than we expect, increasing liquidity stress and uncertainty about the country's capacity to repay debt amortizing in 2026.

At the same time, indications that the sovereign may be less willing to service its debt, including a new debt restructuring, would prompt us to downgrade it. At the current rating level, we would likely consider a broad debt restructuring, debt repurchase, or debt exchange as distressed and tantamount to default.

Upside scenario.  We could revise the outlook to stable in the next 12 months if we see progress in execution of policies that continue to strengthen Ecuador's financial and economic profile. A faster reduction of Ecuador's fiscal deficit or more clarity on its external bond amortizations payment strategy would reduce uncertainty and facilitate the country's access to voluntary market financing as scheduled external flows decrease in 2025-2026.

(Last research update published on Jan. 11, 2024)

Table 17

Ecuador
	2018	2019	2020	2021	2022	2023	2024e	2025e	2026e	2027e
GDP per capita (in ‘000)	6.29	6.20	5.47	6.10	6.58	6.66	6.79	6.94	7.13	7.34
GDP growth	1.04	0.17	-9.25	9.82	6.19	2.36	0.50	1.20	1.70	2.00
GDP per capita growth	-0.64	-1.44	-10.12	9.27	5.58	1.67	-0.08	0.70	1.19	1.49
Current account balance/GDP	-1.22	-0.14	2.30	2.88	1.82	1.88	4.23	2.76	2.41	1.89
Gross external financing needs/CAR&FXR	155.50	148.89	145.34	116.98	112.56	113.08	115.50	112.88	110.47	109.52
Narrow net external debt/CAR	147.60	159.43	179.94	144.71	121.43	124.95	111.05	108.30	100.72	96.47
GG balance/GDP	-3.70	-4.02	-7.47	-2.56	0.17	-3.90	-2.30	-2.50	-2.40	-2.10
GG net debt/GDP	42.89	49.39	61.58	54.38	51.64	51.76	53.29	54.38	55.08	55.31
CPI inflation	0.27	-0.07	-0.08	0.13	3.47	2.21	2.00	1.50	1.50	1.50
Bank credit to resident private sector/GDP	35.99	40.10	46.27	47.37	50.14	53.74	54.26	54.41	55.07	55.77
e--Estimate.

El Salvador (B-/Stable/B)

• Analyst: omar.delatorre@spglobal.com
• Latest publication: El Salvador 'B-/B' Ratings Affirmed On Repurchase Offer And $1 Billion External Issuance; Outlook Remains Stable, Nov. 15, 2024

Rating score snapshot

• Institutional assessment: 6
• Economic assessment: 5
• External assessment: 5
• Fiscal assessment – Flexibility and performance: 6
• Fiscal assessment – Debt burden: 6
• Monetary assessment: 6

Outlook: Stable

The stable outlook balances El Salvador's fiscal relief from the broad debt reprofiling since 2022 against the high debt burden with hefty interest payments.

Downside scenario.  We could lower the ratings in the next six to 12 months if we see a weakening in the government's ability to undertake and implement fiscal adjustment measures to stabilize its debt burden. We could also downgrade El Salvador if its funding sources become more limited or if there are signs that it's becoming less willing to service its debt.

Upside scenario.  We could raise the ratings in the next six to 12 months if the government is able to implement comprehensive reforms to consistently narrow its fiscal deficits and continue to reduce its financing needs, leading to a faster-than-expected stabilization of its debt level. Stronger-than-expected economic growth could also facilitate fiscal consolidation and result in an upgrade.

Table 18

El Salvador
	2018	2019	2020	2021	2022	2023	2024e	2025e	2026e	2027e
GDP per capita (in ‘000)	4.39	4.52	4.18	4.86	5.34	5.66	5.87	6.09	6.31	6.54
GDP growth	2.41	2.44	-7.89	11.90	2.80	3.51	2.50	2.40	2.40	2.40
GDP per capita growth	2.12	2.15	-8.16	11.59	2.51	3.22	2.21	2.11	2.11	2.11
Current account balance/GDP	-3.30	-0.42	1.11	-4.31	-6.82	-1.37	-2.03	-1.81	-2.00	-2.19
Gross external financing needs/CAR&FXR	127.58	121.95	113.15	122.02	124.44	118.40	118.73	117.18	114.56	115.90
Narrow net external debt/CAR	78.88	78.42	93.74	70.65	66.04	73.97	72.84	72.05	70.88	69.76
GG balance/GDP	-2.70	-3.07	-10.03	-5.53	-2.69	-4.66	-4.39	-4.18	-4.07	-3.95
GG net debt/GDP	65.98	67.10	83.00	77.66	73.54	73.89	75.34	76.67	77.84	78.84
CPI inflation	1.09	0.08	-0.37	3.47	7.20	4.05	1.60	1.50	1.50	1.50
Bank credit to resident private sector/GDP	57.28	59.07	65.33	61.14	62.38	61.45	60.86	60.27	59.69	59.12
e--Estimate.

Falkland Islands (A+/Stable/A-1)

• Analyst: jennifer.love@spglobal.com
• Latest publication: Full Analysis: Falkland Islands, March 25, 2024

Rating score snapshot

• Institutional assessment: 3
• Economic assessment: 2
• External assessment: 4
• Fiscal assessment – Flexibility and performance: 1
• Fiscal assessment – Debt burden: 1
• Monetary assessment: 6

Outlook: Stable

The stable outlook is based on S&P Global Ratings' expectation of continued prudent fiscal policy, GDP growth, and strong public finances during the next three years. It also reflects our expectation that institutional links with the U.K. will remain strong, anchoring policy stability and security.

Downside scenario.  We could lower the ratings over the next two to three years if we saw an unexpected deterioration in public finances or economic growth prospects, including a worsening of the government's current net asset position. We could also lower the ratings if unanticipated changes in the institutional and political links with the U.K. were to raise uncertainty about future policies, governance, or security.

Upside scenario.  We could raise the ratings over the next two to three years if we saw a continued record of cautious policymaking that delivers balanced economic growth, sustains healthy finances, and improves the Falkland Islands' physical infrastructure. We could also raise the ratings if improvements in the availability of statistical data, such as full balance of payments and international investment position, improve our assessment of external risk and enhance transparency.

(Last research update published on May 10, 2021)

Table 19

Falkland Islands
	2018	2019	2020	2021	2022	2023	2024e	2025e	2026e	2027e
GDP per capita (in ‘000)	107.03	101.47	103.29	121.16	109.33	111.59	119.39	124.19	128.39	134.00
GDP growth	3.77	12.25	-8.37	5.00	0.60	-0.89	2.00	2.00	2.00	2.00
GDP per capita growth	3.77	12.25	-8.40	7.01	0.60	-0.89	2.00	2.00	2.00	2.00
Current account balance/GDP	N/A	N/A	N/A	N/A	N/A	N/A	N/A	N/A	N/A	N/A
Gross external financing needs/CAR&FXR	N/A	N/A	N/A	N/A	N/A	N/A	N/A	N/A	N/A	N/A
Narrow net external debt/CAR	N/A	N/A	N/A	N/A	N/A	N/A	N/A	N/A	N/A	N/A
GG balance/GDP	9.07	-1.06	1.60	2.33	0.50	-1.40	-12.81	-12.12	-12.12	0.88
GG net debt/GDP	-132.58	-153.52	-157.76	-166.53	-147.03	-143.78	-142.63	-128.23	-114.90	-108.63
CPI inflation	3.14	1.50	-1.45	2.53	6.95	6.89	2.60	2.30	2.00	2.00
Bank credit to resident private sector/GDP	0.00	0.00	0.00	0.00	0.00	0.00	0.00	0.00	0.00	0.00
e--Estimate. N/A--Not applicable.

Guatemala (BB/Positive/B)

• Analyst: patricio.vimberg@spglobal.com
• Latest publication: Guatemala Outlook Revised To Positive On Sustained Macroeconomic Resilience; 'BB/B' Ratings Affirmed, April 18, 2024

Rating score snapshot

• Institutional assessment: 4
• Economic assessment: 5
• External assessment: 2
• Fiscal assessment – Flexibility and performance: 3
• Fiscal assessment – Debt burden: 3
• Monetary assessment: 4

Outlook: Positive

The positive outlook indicates our expectation of an upgrade in the next six to 12 months if cautious macroeconomic policies prevail, despite somewhat higher fiscal deficits stemming from the planned rise in infrastructure spending. The positive outlook also reflects the country's strong external resilience despite long-standing institutional challenges and episodes of political uncertainty.

Upside scenario.  We could raise the ratings in the next six to 12 months on signs that the new administration and Congress can collaborate on policy initiatives, particularly those that entrench and extend cautious macroeconomic policies. This could raise investor confidence and lead to higher-than-expected economic growth.

Downside scenario.  We could revise the outlook to stable in the next six to 12 months if worse-than-expected economic performance or increased political tensions undermine Guatemala's medium-term GDP growth trajectory or constrain the government's ability to keep cautious macroeconomic policies. We could also lower the ratings if there were to be a substantial increase in fiscal deficits and debt intake to finance operating expenditures, rather than improving the country's infrastructure.

Table 20

Guatemala
	2018	2019	2020	2021	2022	2023	2024e	2025e	2026e	2027e
GDP per capita (in ‘000)	4.49	4.65	4.61	5.05	5.51	5.93	6.24	6.57	6.91	7.27
GDP growth	3.41	4.02	-1.79	8.03	4.20	3.53	3.50	3.50	3.50	3.50
GDP per capita growth	1.77	2.41	-3.27	6.45	2.71	2.09	2.10	2.15	2.19	2.23
Current account balance/GDP	0.89	2.36	5.05	2.17	1.25	3.14	1.19	-0.42	-1.38	-2.02
Gross external financing needs/CAR&FXR	68.77	65.22	55.92	62.14	64.88	63.22	65.74	69.80	72.27	74.17
Narrow net external debt/CAR	23.11	13.57	-0.60	-6.91	-7.96	-10.05	-14.45	-14.34	-11.34	-6.52
GG balance/GDP	-0.94	-1.72	-3.57	-0.62	-1.02	-0.79	0.40	-2.10	-2.10	-2.10
GG net debt/GDP	15.22	15.76	19.53	17.55	16.76	15.40	14.10	15.31	16.44	17.49
CPI inflation	3.75	3.70	3.21	4.26	6.89	6.21	3.50	4.00	4.00	4.00
Bank credit to resident private sector/GDP	36.68	35.83	37.61	38.04	39.78	41.39	41.39	41.39	41.39	41.49
e--Estimate.

Honduras (BB-/Negative/B)

• Analyst: patricio.vimberg@spglobal.com
• Latest publication: Honduras Outlook Revised To Negative From Stable On Weaker Monetary Flexibility; 'BB-/B' Ratings Affirmed, Sept. 20, 2024

Rating score snapshot

• Institutional assessment: 5
• Economic assessment: 5
• External assessment: 2
• Fiscal assessment – Flexibility and performance: 5
• Fiscal assessment – Debt burden: 3
• Monetary assessment: 5

Outlook: Negative

The negative outlook incorporates our view that the country's exchange rate and monetary rigidities could harm its external profile and dent investor sentiment, as well as lower its economic growth prospects.

Downside scenario.  We could lower the ratings in the next six to 12 months if limited access to external financing leads to a further decrease in international reserves and worsens external liquidity. Furthermore, limited exchange rate flexibility and potential political uncertainties could deteriorate investor sentiment and translate into lower economic growth prospects, leading to a downgrade.

Upside scenario.  We could revise the outlook to stable in the next six to 12 months if we see progress on monetary and exchange rate policies that generates additional external financing from official and commercial creditors. Successful implementation of reforms that result in stronger public finances and higher long-term GDP growth, while addressing weaknesses in the energy sector, could also lead to an upgrade.

Table 21

Honduras
	2018	2019	2020	2021	2022	2023	2024e	2025e	2026e	2027e
GDP per capita (in ‘000)	2.65	2.70	2.49	2.96	3.25	3.51	3.70	3.82	3.98	4.15
GDP growth	3.84	2.56	-8.97	12.57	4.14	3.58	3.40	3.00	3.60	3.60
GDP per capita growth	2.16	0.92	-10.39	10.82	2.55	2.02	1.86	1.49	2.11	2.13
Current account balance/GDP	-5.48	-1.60	3.89	-3.49	-4.56	-2.89	-4.16	-3.65	-3.12	-3.31
Gross external financing needs/CAR&FXR	93.10	91.08	79.15	82.76	86.95	87.95	93.56	96.30	95.77	99.18
Narrow net external debt/CAR	39.01	30.20	22.66	18.62	16.81	20.06	23.67	26.62	28.57	30.70
GG balance/GDP	0.22	0.09	-4.58	-3.17	0.45	-1.96	-2.30	-2.30	-2.00	-1.70
GG net debt/GDP	35.37	36.18	46.54	45.22	42.46	36.30	37.51	38.93	39.73	40.17
CPI inflation	4.35	4.37	3.48	4.47	9.08	6.69	4.60	4.00	4.00	4.00
Bank credit to resident private sector/GDP	62.90	64.54	71.33	67.73	70.10	75.57	78.26	80.36	82.05	83.76
e--Estimate.

Jamaica (BB-/Positive/B)

• Analyst: jennifer.love@spglobal.com
• Latest publication: Jamaica Outlook Revised To Positive From Stable On Institutional Strengthening, Sept. 24, 2024

Rating score snapshot

• Institutional assessment: 4
• Economic assessment: 6
• External assessment: 4
• Fiscal assessment – Flexibility and performance: 1
• Fiscal assessment – Debt burden: 5
• Monetary assessment: 4

Outlook: Positive

The positive outlook reflects the possibility of an upgrade if continued strengthening of the policy framework raises the likelihood of more sustainable public finances and balanced economic growth over the long term. Continuity with cautious public-sector management, combined with macroeconomic policy that enhances economic resilience, could strengthen Jamaica's institutional framework.

Downside scenario.  We could revise the outlook to stable during the next 12-18 months if we believed changing fiscal policy would lead to sustained deficits, reversing debt reduction and resulting in a persistently higher debt burden; or if the economy fails to perform as expected, weakening the country's external position.

Upside scenario.  We could raise the ratings over the next 12-18 months if Jamaica demonstrates continuity of fiscal policy that increases the sovereign's economic resilience. We could also raise the rating if the economic growth rate rises consistently and converges with that of peers at a similar level of economic development.

Table 22

Jamaica
	2018	2019	2020	2021	2022	2023	2024e	2025e	2026e	2027e
GDP per capita (in ‘000)	5.76	5.79	5.05	5.35	6.23	7.07	7.23	7.70	7.98	8.25
GDP growth	1.90	0.89	-10.11	4.60	4.31	2.15	-1.45	4.20	1.50	1.30
GDP per capita growth	1.71	0.78	-10.21	4.48	4.16	2.02	-1.57	4.07	1.37	1.17
Current account balance/GDP	-1.49	-1.91	-1.14	1.02	-0.80	2.93	0.44	-0.83	-1.13	-1.11
Gross external financing needs/CAR&FXR	99.80	101.09	100.51	99.94	98.80	94.99	96.67	97.69	98.62	99.24
Narrow net external debt/CAR	88.30	76.46	108.32	74.82	57.67	53.00	58.08	60.15	64.12	66.62
GG balance/GDP	1.39	1.09	-2.83	1.31	1.20	0.37	0.32	0.59	0.57	0.56
GG net debt/GDP	76.58	71.52	85.21	76.52	61.09	56.50	55.65	51.67	49.12	46.84
CPI inflation	3.66	3.95	5.23	5.87	10.35	6.47	5.00	5.00	5.00	5.00
Bank credit to resident private sector/GDP	44.01	48.73	57.09	55.13	51.54	49.87	53.73	54.92	57.38	60.12
e--Estimate.

Mexico (BBB/Stable/A-2)

• Analyst: joydeep.mukherji@spglobal.com
• Latest publication: Mexico 'BBB' Foreign Currency And 'BBB+' Local Currency Long-Term Ratings Affirmed; Outlook Remains Stable, Dec. 13, 2024

Rating score snapshot

• Institutional assessment: 3
• Economic assessment: 5
• External assessment: 2
• Fiscal assessment – Flexibility and performance: 4
• Fiscal assessment – Debt burden: 4
• Monetary assessment: 3

Outlook: Stable

The stable outlook reflects our expectation that cautious macroeconomic management, including prudent monetary policy and a return to low fiscal deficits, will stabilize public finances and the sovereign's debt burden over the next two years. We assume that disputes between Mexico and the U.S. on trade, immigration, and other matters will be managed in a pragmatic manner that sustains economic stability and maintains the deep economic integration of the two countries.

Downside scenario.  Failure to reduce the recently high fiscal deficit in a timely manner could lead to a higher-than-expected general government debt and interest burden. Weaker public finances, combined with the risk of extraordinary support to state-owned companies Petroleos Mexicanos (Pemex) and Comision Federal de Electricidad (CFE), could lead to a downgrade over the next two years.

Similarly, unexpected developments that weaken investor sentiment and investment, such as setbacks in ties with the U.S. or negative economic fallout from controversial recent changes to the judiciary, could undermine macroeconomic stability and lead to a downgrade.

Upside scenario.  We could raise the ratings over the next two years if effective political and economic management, including attracting greater foreign investment due to nearshoring, boosts investment and raises Mexico's low rate of per capita GDP growth. Similarly, steps to bolster budgetary flexibility, rebuild fiscal buffers, and broaden the non-oil tax base to mitigate the potential contingent liability posed by state-owned companies in the energy sector would improve creditworthiness.

Table 23

Mexico
	2018	2019	2020	2021	2022	2023	2024e	2025e	2026e	2027e
GDP per capita (in ‘000)	10.00	10.20	8.70	10.10	11.10	13.50	13.70	13.10	13.30	13.70
GDP growth	2.00	-0.30	-8.60	5.70	4.20	3.20	1.50	1.20	1.90	2.20
GDP per capita growth	0.80	-1.30	-9.60	4.70	3.10	2.20	0.50	0.30	1.00	1.30
Current account balance/GDP	-2.10	-0.40	2.00	-0.60	-0.90	-0.80	-1.20	-1.30	-1.50	-1.40
Gross external financing needs/CAR&FXR	87.90	87.60	82.00	87.20	87.80	86.90	89.70	88.20	89.50	89.90
Narrow net external debt/CAR	46.80	51.70	57.20	38.70	28.30	28.90	28.00	29.20	29.10	28.70
GG balance/GDP	-1.80	-1.80	-2.30	-2.90	-3.20	-3.60	-5.40	-3.40	-2.80	-2.80
GG net debt/GDP	40.10	40.40	45.60	45.50	45.00	45.70	48.90	50.70	51.50	52.10
CPI inflation	4.90	3.60	3.40	5.70	7.90	5.50	4.70	3.90	3.40	3.10
Bank credit to resident private sector/GDP	27.60	29.20	28.90	27.50	27.40	26.60	26.70	26.90	27.10	27.20
e--Estimate.

Montserrat (BBB-/Stable/A-3)

• Analyst: jennifer.love@spglobal.com
• Latest publication: Full Analysis: Montserrat, April 24, 2024

Rating score snapshot

• Institutional assessment: 2
• Economic assessment: 5
• External assessment: 3
• Fiscal assessment – Flexibility and performance: 4
• Fiscal assessment – Debt burden: 1
• Monetary assessment: 5

Outlook: Stable

The stable outlook reflects our expectation that budgetary and institutional support for Montserrat from the U.K. will continue over the next two years. We believe the recovery in Montserrat will be spurred mainly by the public sector and key construction projects, while tourism is expected to gradually increase. We believe the U.K.'s support for Montserrat will be unchanged and will continue to underpin the island's creditworthiness and mitigate the risks from external vulnerabilities, particularly given the continuing low-level activity of the Soufriere Hills volcano and the island's location in a hurricane belt.

Downside scenario.  We could lower the ratings over the next two years if the U.K.'s financial support substantially and unexpectedly wanes, particularly before the domestic economy approaches self-sufficiency. This could exacerbate external liquidity risks arising from Montserrat's significant gross external financing needs. Under this scenario, we expect the loss of a significant portion of government revenue (grants from the U.K.) would contribute to large fiscal and external deficits and could lead to a multinotch downgrade. The U.K.'s failure to provide timely support in the wake of a natural disaster could exacerbate these risks.

Upside scenario.  Significant private-sector investment and faster public-sector execution of infrastructure development on the island could lead to an upgrade in the next couple of years. Such activities would increase the size and resilience of Montserrat's economy, broadening the tax base. Sustainable private-sector growth--particularly in the tourism and export sectors--could raise the island's income and reduce economic concentration in public services. This expansion, along with immigration to build the labor force, would also increase imports. To be sustainable, export growth and foreign direct investment would need to finance this expansion, limiting the increase of net external borrowing from the island's large external financing needs.

(Last research update published on April 13, 2021)

Table 24

Montserrat
	2018	2019	2020	2021	2022	2023	2024e	2025e	2026e	2027e
GDP per capita (in ‘000)	13.48	14.53	14.45	16.25	16.13	17.57	18.21	18.81	19.36	19.84
GDP growth	7.58	6.41	-1.13	5.48	2.52	7.29	3.00	2.00	2.00	2.00
GDP per capita growth	9.90	9.90	-3.42	12.43	-0.69	4.99	3.00	2.00	2.00	2.00
Current account balance/GDP	-2.28	2.30	9.06	-18.85	-11.45	-9.12	-13.45	-11.78	-10.38	-9.33
Gross external financing needs/CAR&FXR	122.55	118.09	114.29	148.20	129.92	129.47	142.54	142.06	141.31	141.02
Narrow net external debt/CAR	-167.63	-168.46	-211.35	-205.01	-150.51	-130.31	-138.45	-136.48	-134.82	-133.64
GG balance/GDP	-0.96	-12.60	-3.96	1.24	3.95	4.18	0.00	0.00	0.00	0.00
GG net debt/GDP	-14.41	-7.52	-5.76	-4.32	-3.76	-1.49	-1.14	-0.81	-0.37	0.04
CPI inflation	1.31	-1.07	-1.89	2.61	2.98	-1.09	0.65	1.29	0.96	0.45
Bank credit to resident private sector/GDP	51.92	48.92	48.32	46.48	40.76	38.18	36.83	35.66	34.64	33.81
e--Estimate.

Nicaragua (B+/Stable/B)

• Analyst: omar.delatorre@spglobal.com
• Latest publication: Nicaragua Long-Term Ratings Raised To 'B+' On Fiscal And External Strengthening; Outlook Stable, Oct. 23, 2024

Rating score snapshot

• Institutional assessment: 5
• Economic assessment: 5
• External assessment: 4
• Fiscal assessment – Flexibility and performance: 3
• Fiscal assessment – Debt burden: 2
• Monetary assessment: 5

Outlook: Stable

The stable outlook balances the sovereign's cautious fiscal policies that will curtail its external financing needs, with institutional weaknesses--a high centralization of power, weak checks and balances--coupled with recent emigration that hinder long-term economic growth prospects, which we expect to remain below the country's historical levels.

Downside scenario.  We could lower the ratings in the next six to 18 months if Nicaragua's economic performance were to be undermined by weaker demand from its trade partners, external shocks, or unexpected political tensions.

Upside scenario.  We could raise the ratings in the next six to 18 months if favorable political and policy developments raise investor confidence, lead to higher-than-expected economic growth, and improve the sovereign's access to external funding. A track record of strengthening economic and fiscal results that lower Nicaragua's exposure to external shocks on a consistent basis could also lead to an upgrade.

Table 25

Nicaragua
	2018	2019	2020	2021	2022	2023	2024e	2025e	2026e	2027e
GDP per capita (in ‘000)	2.02	1.95	1.92	2.12	2.32	2.62	2.80	2.97	3.13	3.30
GDP growth	-3.36	-2.90	-1.76	10.32	3.75	4.57	3.80	3.50	3.50	3.50
GDP per capita growth	-4.36	-3.90	-2.77	9.18	2.68	3.49	2.73	2.43	2.43	2.43
Current account balance/GDP	-1.80	5.94	3.71	-3.82	-2.47	7.75	3.61	1.41	0.37	-0.50
Gross external financing needs/CAR&FXR	91.89	89.35	87.54	94.55	91.18	79.47	80.10	76.65	74.26	72.86
Narrow net external debt/CAR	121.14	111.80	121.01	101.41	77.68	54.59	42.92	34.42	28.02	23.27
GG balance/GDP	-3.02	-0.32	-1.78	-1.20	0.98	2.45	0.17	0.16	-0.04	-0.25
GG net debt/GDP	45.38	48.64	51.35	52.09	45.74	38.91	35.70	33.45	31.53	29.92
CPI inflation	4.95	5.38	3.68	4.93	10.47	8.39	4.50	4.00	4.00	4.00
Bank credit to resident private sector/GDP	36.09	30.00	27.99	25.78	26.24	26.75	27.49	28.26	29.05	29.86
e--Estimate.

Panama (BBB-/Stable/A-3)

• Analyst: karla.gonzalez@spglobal.com
• Latest publication: Panama Ratings Lowered To 'BBB-/A-3' On Higher Interest Burden; Outlook Stable, Nov. 26, 2024

Rating score snapshot

• Institutional assessment: 3
• Economic assessment: 2
• External assessment: 5
• Fiscal assessment – Flexibility and performance: 3
• Fiscal assessment – Debt burden: 5
• Monetary assessment: 5

Outlook: Stable

The stable outlook reflects our expectation of political stability, continuity in key economic policies, and a gradual reduction in the general government fiscal deficit. We expect that the new government will implement fiscal policy measures to stabilize the sovereign's debt and interest burdens. Moreover, Panama's diversified economy and pro-growth policies should sustain GDP growth above the average level of its peers.

Downside scenario.  We could lower the ratings in the next 12-24 months if policy setbacks prevent a reduction in fiscal deficits, translating into a faster-than-expected debt buildup. Amid more uncertain global conditions, Panama's slower-than-expected economic performance could also weaken the creditworthiness.

Upside scenario.  We could raise the ratings in the next 12-24 months if Panama's external profile strengthens or if its fiscal performance improves beyond our expectations. This could be achieved through spending control measures and revenue strengthening.

Table 26

Panama
	2018	2019	2020	2021	2022	2023	2024e	2025e	2026e	2027e
GDP per capita (in ‘000)	17.64	18.01	14.54	16.92	18.87	20.32	20.89	21.86	22.91	24.13
GDP growth	4.39	3.28	-17.67	15.84	11.01	7.40	3.00	3.80	4.00	4.50
GDP per capita growth	2.90	1.81	-18.85	14.18	9.42	5.86	1.78	2.57	2.77	3.26
Current account balance/GDP	-7.38	-4.78	-0.33	-1.16	-0.62	-4.49	-2.63	-2.88	-3.01	-3.00
Gross external financing needs/CAR&FXR	177.73	181.24	189.07	145.44	144.21	164.45	178.11	174.38	171.68	169.16
Narrow net external debt/CAR	78.15	90.58	104.34	97.54	96.01	111.53	107.96	106.61	105.25	103.17
GG balance/GDP	-2.70	-2.90	-9.58	-6.46	-3.96	-3.18	-6.00	-4.00	-3.50	-3.30
GG net debt/GDP	25.17	29.41	46.55	44.39	42.08	42.14	46.51	47.93	48.68	48.97
CPI inflation	0.77	-0.29	-1.62	1.65	2.86	1.48	1.00	2.00	2.00	2.00
Bank credit to resident private sector/GDP	78.93	77.81	93.27	80.57	74.47	70.39	70.71	69.79	68.75	69.01
e--Estimate.

Paraguay (BB+/Stable/B)

• Analyst: carolina.caballero@spglobal.com
• Latest publication: Paraguay Long-Term Ratings Raised To ‘BB+’ On Greater Economic Resiliency; Outlook Stable, Feb. 1, 2024

Rating score snapshot

• Institutional assessment: 4
• Economic assessment: 4
• External assessment: 2
• Fiscal assessment – Flexibility and performance: 3
• Fiscal assessment – Debt burden: 3
• Monetary assessment: 5

Outlook: Stable

The stable outlook reflects our view that continued strengthening of the Paraguayan economy, supported by private-sector investments, could mitigate potential climate risks and contribute to the government's capacity to absorb recent increases in debt.

Downside scenario.  We could lower the ratings in the next 12-18 months if slower-than-expected growth, due to higher frequency of external and weather shocks, reduces the growth potential and weakens the government's commitment to fiscal consolidation. This could weaken the economy and increase the debt burden.

Upside scenario.  We could raise the ratings in the next 24 months if effective political and economic management leads to a sustainable fiscal consolidation amid continued strengthening of Paraguay's political and economic institutions, reducing the government's vulnerabilities to the level of those of investment-grade sovereigns.

Table 27

Paraguay
	2018	2019	2020	2021	2022	2023	2024e	2025e	2026e	2027e
GDP per capita (in ‘000)	6.76	6.33	5.88	6.58	6.87	6.98	7.21	7.36	7.76	8.18
GDP growth	3.20	-0.40	-0.82	4.02	0.18	4.71	4.00	3.50	3.50	3.00
GDP per capita growth	2.53	-1.06	-1.47	3.33	-0.48	4.03	3.32	2.82	2.82	2.32
Current account balance/GDP	-0.22	-0.57	1.89	-0.87	-7.14	0.24	-2.63	-3.34	-3.52	-2.78
Gross external financing needs/CAR&FXR	79.77	81.17	75.49	74.48	86.54	79.88	84.35	85.81	87.89	87.44
Narrow net external debt/CAR	5.25	11.89	19.53	26.18	41.35	36.90	39.15	39.01	38.92	37.48
GG balance/GDP	-1.00	-2.38	-5.72	-3.39	-2.64	-3.92	-2.70	-2.20	-1.70	-1.60
GG net debt/GDP	7.90	11.27	19.20	20.37	26.10	26.92	29.98	30.28	30.12	29.90
CPI inflation	3.98	2.79	1.72	4.79	9.77	4.65	4.20	4.00	4.00	4.00
Bank credit to resident private sector/GDP	38.77	41.52	45.12	45.37	43.39	44.72	45.93	46.94	47.03	46.53
e--Estimate.

Peru (BBB-/Stable/A-3)

• Analyst: constanza.perez.aquino@spglobal.com
• Latest publication: Peru Long-Term Foreign Currency Rating Lowered To 'BBB-' On Political Uncertainty Constraining Growth; Outlook Stable, April 25, 2024

Rating score snapshot

• Institutional assessment: 4
• Economic assessment: 4
• External assessment: 3
• Fiscal assessment – Flexibility and performance: 2
• Fiscal assessment – Debt burden: 3
• Monetary assessment: 3

Outlook: Stable

The stable outlook incorporates our expectation of a moderate recovery in real GDP, while net general government debt continues to rise but remains below 30% of GDP over 2024-2027. We assume Peru's monetary policy credibility and strong external position will remain ratings strengths.

Downside scenario.  We could lower the ratings over the next two years if there is a pronounced shift in economic policy that precipitates further deterioration in investor sentiment and growth prospects. Lower growth could, in turn, put additional pressure on fiscal deficits and accelerate an increase in the debt burden.

Upside scenario.  We could raise the ratings over the next two years if stable political conditions support effective policy execution that boosts investment and economic growth prospects. Under this scenario, we would also expect a moderately stable debt trajectory.

Table 28

Peru
	2018	2019	2020	2021	2022	2023	2024e	2025e	2026e	2027e
GDP per capita (in ‘000)	7.20	7.28	6.37	6.90	7.35	7.94	8.50	8.66	8.93	9.29
GDP growth	3.97	2.24	-10.87	13.42	2.68	-0.55	2.87	2.76	2.69	2.86
GDP per capita growth	2.70	0.99	-11.96	12.03	1.43	-1.76	1.95	1.85	1.77	1.94
Current account balance/GDP	-1.16	-0.55	1.08	-2.07	-3.99	0.83	1.14	0.80	0.47	0.44
Gross external financing needs/CAR&FXR	73.85	73.90	62.02	68.20	73.14	68.66	70.88	69.88	69.74	69.46
Narrow net external debt/CAR	22.17	13.69	18.57	30.09	33.40	36.19	34.13	33.61	31.99	30.53
GG balance/GDP	-1.96	-1.39	-8.31	-2.54	-1.43	-2.84	-3.50	-2.50	-2.20	-2.10
GG net debt/GDP	10.11	11.53	20.72	20.43	20.08	21.35	23.15	24.35	25.14	25.69
CPI inflation	1.32	2.14	1.83	3.98	7.88	6.27	2.45	2.43	2.37	2.37
Bank credit to resident private sector/GDP	43.51	44.29	54.49	47.38	46.22	43.65	40.41	40.02	40.19	40.27
e--Estimate.

Suriname (CCC+/Stable/C)

• Analyst: julia.smith@spglobal.com
• Latest publication: Republic of Suriname Foreign And Local Currency Ratings Raised To 'CCC+/C' From 'SD'; Outlook Stable, Dec. 6, 2023

Rating score snapshot

• Institutional assessment: 6
• Economic assessment: 6
• External assessment: 6
• Fiscal assessment – Flexibility and performance: 6
• Fiscal assessment – Debt burden: 6
• Monetary assessment: 6

Outlook: Stable

The stable outlook balances the government's commitment to fiscal reform and macroeconomic stabilization with the finalization of the debt restructuring and risks presented by developing institutions and weaknesses in governance, including debt management.

Downside scenario.  We could lower our ratings over the next six to 12 months if expected financing from multilateral lending institutions failed to materialize, or if other policy or administrative developments raised the likelihood of another default.

Upside scenario.  We could raise our ratings over the next year if the government continues to progress on concluding restructuring agreements with its creditors, continues to make progress on its reform targets and meeting the conditions of multilateral lending institutions with which it has agreements, and develops a track record of strengthened debt management, and proactive economic policies that reduce the likelihood of another commercial debt payment default.

Table 29

Suriname
	2018	2019	2020	2021	2022	2023	2024e	2025e	2026e	2027e
GDP per capita (in ‘000)	6.77	7.12	6.83	5.45	6.07	5.45	6.21	6.69	6.95	7.12
GDP growth	4.95	1.17	-15.98	-2.44	2.41	2.54	3.00	3.00	3.00	3.00
GDP per capita growth	3.76	-0.17	-17.48	-3.64	1.03	1.16	1.58	1.58	1.58	1.58
Current account balance/GDP	-2.97	-10.54	6.25	5.24	2.01	4.30	2.17	1.83	1.65	1.50
Gross external financing needs/CAR&FXR	107.29	112.35	97.14	99.62	97.29	97.02	98.02	98.40	99.96	104.51
Narrow net external debt/CAR	57.97	78.12	68.60	60.32	47.73	42.68	35.02	36.44	39.12	41.18
GG balance/GDP	-9.92	-20.23	-11.10	1.45	-0.69	-1.86	-0.99	-0.08	-0.99	-0.99
GG net debt/GDP	57.48	66.77	113.37	102.09	97.47	85.20	77.99	71.36	67.43	64.54
CPI inflation	5.44	4.22	60.74	60.69	54.56	32.63	12.70	11.30	8.20	6.00
Bank credit to resident private sector/GDP	27.33	26.04	28.07	21.04	22.10	19.47	19.05	18.92	18.80	18.55
e--Estimate.

Trinidad and Tobago (BBB-/Stable /A-3)

• Analyst: jennifer.love@spglobal.com
• Latest publication: Trinidad and Tobago 'BBB-/A-3' Rating Affirmed; Outlook Is Stable, Sept. 6, 2024

Rating score snapshot

• Institutional assessment: 3
• Economic assessment: 4
• External assessment: 3
• Fiscal assessment – Flexibility and performance: 3
• Fiscal assessment – Debt burden: 4
• Monetary assessment: 4

Outlook: Stable

The stable outlook reflects S&P Global Ratings' view that Trinidad and Tobago's economy will continue to experience low growth, moderate fiscal deficits, and a slowly increasing debt burden over the next two years, while energy exports will support the country's external balances. We expect broad continuity in key economic policies after national elections due next year.

Downside scenario.  We could lower the ratings over the next two years if GDP per capita fails to rise in line with our forecast. Similarly, failure to take timely corrective steps to ensure long-term balanced economic growth and the sustainability of public finances could erode the country's capacity to respond to economic or other challenges, resulting in a lower rating that reflects institutional shortcomings. We could also lower the rating if Trinidad and Tobago's external position materially worsens beyond our base-case scenario.

Upside scenario.  We could raise the rating over the next 24 months if stronger economic performance and favorable long-term GDP growth prospects lead to a sustained fall in the government's net debt burden and improve the country's external profile.

Table 30

Trinidad and Tobago
	2018	2019	2020	2021	2022	2023	2024e	2025e	2026e	2027e
GDP per capita (in ‘000)	17.68	17.04	14.87	17.91	22.00	20.04	20.21	20.59	21.11	21.63
GDP growth	-0.60	0.36	-9.08	-1.04	1.48	1.35	0.32	0.37	0.96	0.86
GDP per capita growth	-1.02	-0.01	-9.37	1.27	1.61	1.22	0.02	0.07	0.66	0.56
Current account balance/GDP	6.62	4.29	-6.52	10.73	17.45	12.40	7.48	6.44	6.31	7.73
Gross external financing needs/CAR&FXR	60.15	62.84	76.74	59.51	60.27	58.67	67.70	67.99	74.33	68.30
Narrow net external debt/CAR	-55.61	-56.90	-89.65	-50.88	-28.72	-39.45	-39.72	-33.71	-32.96	-37.24
GG balance/GDP	-3.42	-2.51	-11.88	-7.46	0.66	-1.72	-3.80	-4.14	-3.05	-2.45
GG net debt/GDP	6.44	9.58	25.51	25.32	22.91	26.35	27.64	31.01	33.01	34.40
CPI inflation	1.02	1.00	0.60	2.06	5.83	4.63	1.20	1.80	1.90	1.90
Bank credit to resident private sector/GDP	45.34	49.86	56.07	47.90	41.38	48.98	48.87	48.71	48.51	48.32
e--Estimate.

Turks and Caicos Islands (BBB+/Positive/A-2)

• Analyst: jennifer.love@spglobal.com
• Latest publication: Turks and Caicos Islands Outlook Revised To Positive From Stable On Prospects For Improved Economic Resilience, March 27, 2024

Rating score snapshot

• Institutional assessment: 2
• Economic assessment: 4
• External assessment: 3
• Fiscal assessment – Flexibility and performance: 1
• Fiscal assessment – Debt burden: 1
• Monetary assessment: 6

Outlook: Positive

The positive outlook reflects S&P Global Ratings' view that TCI's economy will continue growing solidly, propelled by the tourism sector. If this growth materializes in line with our forecast, we could revise upward our economic assessment of TCI.

Downside scenario.  We could lower our ratings in the next two years if growth is weaker than we expect, leading to pressure on revenues that causes the government to run persistent fiscal deficits that materially weaken public finances. Similarly, an unexpected lessening of institutional ties with the U.K. that negatively affects governance, as shown in our institutional assessment of TCI, could result in a downgrade.

Upside scenario.  We could raise our ratings in the next two years if GDP growth is sustained in line with our expectations. As TCI maintains other strengths in its institutions, public-sector finances, and debt, these would contribute to improved economic resilience.

Table 31

Turks and Caicos
	2018	2019	2020	2021	2022	2023	2024e	2025e	2026e	2027e
GDP per capita (in ‘000)	31.77	31.94	20.62	26.80	30.05	33.18	34.46	35.63	36.62	37.51
GDP growth	91.14	4.98	-33.82	29.63	14.09	13.68	4.80	4.70	4.30	3.40
GDP per capita growth	83.83	1.11	-36.18	25.16	10.29	10.02	1.26	1.16	0.77	0.39
Current account balance/GDP	19.46	27.46	-2.87	15.85	27.50	25.84	24.85	23.80	22.69	21.51
Gross external financing needs/CAR&FXR	105.67	103.70	162.69	113.27	94.60	92.28	86.03	86.01	86.20	86.66
Narrow net external debt/CAR	-72.70	-53.79	-138.65	-145.67	-100.25	-102.80	-99.19	-96.26	-93.91	-92.37
GG balance/GDP	6.72	4.88	-6.72	10.92	5.55	4.53	1.21	1.30	1.15	1.17
GG net debt/GDP	-33.51	-37.43	-48.82	-47.04	-47.70	-50.31	-47.65	-45.51	-43.63	-42.25
CPI inflation	2.10	2.20	2.30	4.50	6.00	5.50	2.70	2.30	2.10	2.10
Bank credit to resident private sector/GDP	N/A	N/A	N/A	N/A	N/A	N/A	N/A	N/A	N/A	N/A
e--Estimate. N/A--Not applicable.

U.S. (AA+/Stable/A-1+)

• Analyst: lisa.schineller@spglobal.com
• Latest publication: U.S. 'AA+/A-1+' Sovereign Ratings Affirmed; Outlook Remains Stable, March 27, 2024

Rating score snapshot

• Institutional assessment: 2
• Economic assessment: 1
• External assessment: 2
• Fiscal assessment – Flexibility and performance: 5
• Fiscal assessment – Debt burden: 6
• Monetary assessment: 1

Outlook: Stable

The stable outlook reflects the U.S.'s institutional checks and balances, strong rule of law, and free flow of information that contribute to stability and predictability in economic policies. The resilience of American institutions, its economy, and the size and depth of its financial market sustain the U.S. dollar's status as the world's premier reserve currency and support policy flexibility. Comparatively weak fiscal indicators that continue to constrain the sovereign credit rating offset those strengths.

Bipartisan cooperation to strengthen the U.S. fiscal profile--namely to meaningfully lower deficits and tackle budgetary rigidities--remains elusive. We expect that cross-party negotiations on contentious issues such as the government's debt ceiling--which has been raised or suspended on almost 90 occasions since 1960--will continue to be resolved when needed considering the severe consequences of not doing so on financial markets and on the economy.

Downside scenario.  We could lower the rating over the next two to three years if unexpected negative political developments weigh on the strength of American institutions and the effectiveness of long-term policymaking, or jeopardize the dollar's status as the world's leading reserve currency. The ratings could also come under pressure if already-high deficits were to rise, owing to political inability to contain rising spending or to manage revenue implications of future changes in the tax code.

Upside scenario.  Conversely, we could raise the rating over the next two to three years if effective and proactive public policymaking results in improved fiscal performance that substantially reduces general government deficits and lowers the sovereign's debt burden. Sustained long-term GDP growth, along with fiscal adjustments, could diminish the recently high annual increases in the general government's net debt burden, strengthening creditworthiness.

Table 32

U.S.
	2018	2019	2020	2021	2022	2023	2024e	2025e	2026e	2027e
GDP per capita (in ‘000)	63.07	65.44	64.36	71.18	77.83	82.53	86.36	89.30	92.76	96.11
GDP growth	2.97	2.58	-2.16	6.05	2.51	2.89	2.72	1.96	1.97	1.68
GDP per capita growth	2.46	2.09	-2.95	5.77	2.07	2.35	1.69	1.12	1.34	1.24
Current account balance/GDP	-2.13	-2.05	-2.82	-3.67	-3.89	-3.27	-3.44	-3.73	-3.86	-4.01
Gross external financing needs/CAR&FXR	306.69	303.32	356.09	353.29	320.17	310.10	310.19	316.56	325.38	331.76
Narrow net external debt/CAR	313.23	337.88	427.57	392.18	326.11	334.41	358.04	371.57	388.53	397.46
GG balance/GDP	-5.32	-6.57	-16.02	-10.47	-4.11	-9.26	-6.26	-6.02	-5.87	-5.85
GG net debt/GDP	78.23	79.56	93.52	95.34	91.35	91.79	93.11	95.31	97.06	99.13
CPI inflation	2.44	1.81	1.23	4.70	8.00	4.12	2.90	2.26	2.50	2.34
Bank credit to resident private sector/GDP	153.44	153.10	164.34	159.69	153.84	147.72	147.72	147.72	147.72	147.72
e--Estimate.

Uruguay (BBB+/Stable/A-2)

• Analyst: carolina.caballero@spglobal.com
• Latest publication: Uruguay 'BBB+/A-2' Ratings Affirmed; Outlook Remains Stable, Nov. 6, 2024

Rating score snapshot

• Institutional assessment: 3
• Economic assessment: 3
• External assessment: 2
• Fiscal assessment – Flexibility and performance: 5
• Fiscal assessment – Debt burden: 3
• Monetary assessment: 5

Outlook: Stable

The stable outlook reflects our view of continuity in key economic policies after the recent presidential election. We expect prudent fiscal policies and economic growth will maintain general government deficit at moderate levels and that debt will increase only modestly. We expect moderate investments, representing 15% of GDP, across diverse sectors of the economy to support GDP growth of about 2.6% in 2025-2027.

Downside scenario.  We could lower the ratings in the next two years if fiscal performance unexpectedly slips and the government weakens its commitment to contain fiscal deficits. In this scenario, we would expect the net general government debt burden to rise to well above 60% of GDP. A consistently weaker long-term GDP growth trajectory could weigh on economic resilience and lead to a lower rating.

Upside scenario.  We could upgrade Uruguay in the next two years if there's stronger-than-expected fiscal consolidation and a longer track record of lower inflation. Disinflation could support a more stable debt path, significantly reduce economic rigidities such as indexation and help expand private-sector credit. Such developments could accelerate economic growth above our base-case assumptions, while a deeper and well-capitalized financial system would promote financial intermediation and strengthen Uruguay's monetary flexibility.

Table 33

Uruguay
	2018	2019	2020	2021	2022	2023	2024e	2025e	2026e	2027e
GDP per capita (in ‘000)	19.04	18.12	15.62	17.67	20.39	22.42	22.83	23.33	24.22	25.28
GDP growth	0.16	0.93	-7.38	5.56	4.71	0.37	3.10	2.40	2.40	2.50
GDP per capita growth	0.09	0.85	-7.45	5.48	4.63	0.29	3.02	2.32	2.32	2.42
Current account balance/GDP	-0.46	1.29	-0.73	-2.46	-3.73	-3.34	-1.05	-1.21	-0.78	-1.14
Gross external financing needs/CAR&FXR	87.83	85.68	100.15	101.57	103.73	105.15	96.47	93.75	93.14	93.32
Narrow net external debt/CAR	17.83	30.79	41.85	25.03	13.54	22.64	13.36	16.83	18.00	18.75
GG balance/GDP	-1.86	-2.81	-5.17	-3.64	-3.03	-3.21	-3.20	-3.20	-3.10	-3.00
GG net debt/GDP	41.37	45.44	53.34	51.81	48.81	51.02	54.16	55.87	57.16	57.95
CPI inflation	7.61	7.88	9.76	7.75	9.10	5.87	5.00	5.50	5.50	5.20
Bank credit to resident private sector/GDP	25.67	26.01	28.34	27.18	27.24	29.26	31.01	32.88	33.18	33.54
e--Estimate.

Primary Credit Analyst:	Joydeep Mukherji, New York + 1 (212) 438 7351; joydeep.mukherji@spglobal.com
Secondary Contact:	Nicole Schmidt, Mexico City +52 5550814451; nicole.schmidt@spglobal.com