MEXICO CITY, March 14 (Reuters) - Fitch Ratings
downgraded Bolivia's long-term foreign-currency and
local-currency issuer rating to B- from B on Tuesday, citing a
depletion of external liquidity buffers and a sharp fall in
international reserves denting economic stability.
The landlocked South American nation has seen net foreign
currency reserves fall from over $15 billion just under a decade
ago to $3.5 billion last month, which has sparked anxiety about
access to dollars and rattled the local currency.
Fitch also revised the Andean nation's outlook to negative
from stable, citing "heightened uncertainty around the
authorities' ability to manage this situation" and a delay in
publication of up-to-date reserves data.
"The continued fall in international reserves at low levels
has rendered them vulnerable to risk of a confidence shock,
which has materialized in recent weeks," Fitch said, adding the
issue was linked to rising spending and falling gas production.
It added that Bolivia did not face major near-term bond
repayments but that the issue could raise debt risks.
"External bond market access has been lost and there are no
concrete prospects for large-scale support from official
creditors," it said.
"Bolivia's especially low near-term external commercial
service remains its key rating strength, supporting repayment
capacity on these obligations, but even this could be called
into question amid declining and uncertain FX availability."
(Reporting by Javier Lopez de Lerida and Anthony Esposito;
Editing by Cynthia Osterman)
Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.