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Rating Upgrade Refused by Moody for Malaysia



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June 12th, 2007 by financetwitter


Jun 12 2007
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It was a mission impossible for Malaysia second finance minister Nor Yakcop who traveled all the way to New York to ask for a credit rating increase, only to be turned down by Moody who maintains the country credit rating remains “constrained”. Malaysia, which has spent more than it brings in for nine straight years, is seeking to lower borrowing costs and attract foreign investment.

While Moody’s rating on Malaysia’s foreign currency long-term debt remains as A3, the fourth-lowest investment level, Standard & Poor’s has had an A- rating, the equivalent grade.

“Aninda Mitra, Moody’s analyst for Malaysia said “Malaysia’s sovereign bond ratings are somewhat constrained by general government finances that remain weaker than comparable peers”

The Malaysian government expects a budget deficit of 3.4 percent of gross domestic product this year. The median for countries with an A credit rating is 0.5 percent, according to Standard & Poor’s. Yakcop can scream at his top voice to demand for an upgrade as can be heard from his speech but statistic figure would not submit to his demand. To justify for an upgrade the country just need to reduce the deficit but with the recent (last month) announcement of a pay rise of as much as 42 percent to 1 million civil servants (in a bid to prepare for the general election), you just can’t fool an international rating agency.
The pay rise alone will cost the government a whopping RM8 billion a year and Standard & Poor’s is “evaluating” the effect of the pay increase on Malaysia’s credit ratings.


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June 12th, 2007 by financetwitter
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Comments
Comment by Mr Tee C.S on August 2, 2007 at 10:04 am

Guess this is the problem with Malaysia, run by those morons and they thought they will be remembered for the great things they do, sigh !

I thought Dr M was bad, but I can never imagine Pak lah is even worse.

Love live Malaysia…! Mampus 2020!

Comment by Mr Tee C.S on August 2, 2007 at 10:04 am

Guess this is the problem with Malaysia, run by those morons and they thought they will be remembered for the great things they do, sigh !I thought Dr M was bad, but I can never imagine Pak lah is even worse.Love live Malaysia…! Mampus 2020!

Comment by stocktube on August 2, 2007 at 1:02 pm

ever heard of there’s always another mountain which is higher than the one you know?

that’s what malaysia is having now in terms of the premier … there’s always someone who is more “capable” than the previous *grin*

cheers

Comment by stocktube on August 2, 2007 at 1:02 pm

ever heard of there’s always another mountain which is higher than the one you know? that’s what malaysia is having now in terms of the premier … there’s always someone who is more “capable” than the previous *grin*cheers

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