Fitch Downgrades Lebanon's Rating over Political Woes

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Fitch, the rating agency, downgraded Lebanon's long-term foreign and local currency issuer default rating (IDRs) to negative, citing political uncertainties, spill-overs from the Syrian conflict on economic performance and slow growth prospects.

The report said that Lebanon's outlook was downgraded to negative from stable.

Fitch said that the country's long-term foreign and local currency Issuer Default Ratings (IDRs) have been affirmed at 'B', the issue ratings on Lebanon's senior unsecured foreign and local currency bonds are also affirmed at 'B', the Country Ceiling is affirmed at 'B' and the Short-term foreign currency IDR at 'B'.

The ratings agency said that “the involvement of Hizbullah and Sunni groups in the neighboring Syrian conflict has increased sectarian tensions domestically. Violence in Lebanon, though still sporadic, has intensified in recent months,” had an impact on Lebanon's economy, in reference to the conflict in Syria, which erupted in March 2011.

The firm also said that the “ever-rising number of refugees” is adding tension and strains on the country's economy, especially on infrastructure and public institutions.

It said that the absence of agreement on the formation of a new government, Lebanon's political life has been paralyzed since March 2013 and presidential elections in 2014 add to political uncertainty.

Fitch expected that the public debt-to-GDP ration to rise to 138% at end of 2013 and above 140% by the end of 2015.

“No major improvement is to be expected until the Syrian conflict is resolved,” the firm added.

Ratings agency Standard and Poor's lowered in November of the ratings on Lebanon to 'B-' over the “deteriorating fundamentals and rising political risks, adding that the outlook remains negative.”

S&P also lowered to 'B-' from 'B' its long-term counterparty credit ratings on three Lebanese banks, Bank Audi SAL–Audi Saradar Group, BankMed s.a.l., and Blom Bank sal.

The outlooks on all three banks remain negative, the agency said.

Comments 15
Thumb ice-man 20 December 2013, 09:25

I defer judgement on this article to mckinl, our resident IMF austerity expert.

Thumb benzona 20 December 2013, 09:33

they are taking lebanon down the drain.... thank you m8/bachar assad

Thumb ice-man 20 December 2013, 09:44

HA is due to issue a public offering of its stock will be traded on the Qom Stock Exchange (QSE) under ticker HAQ.

Thumb geha 20 December 2013, 09:50


Thumb benzona 20 December 2013, 09:51

they are going to be selling their bitcoins too then.

did you hear that bitcoins are used by drug drug trafficking organisations in the americas and asia? 3/4 of the virtual currency is controled by them.

Thumb benzona 20 December 2013, 10:03

You may say this a joke but it's actually very likely. that's how thugs operate.

Thumb benzona 20 December 2013, 10:11

death to assad-nasrallah-aoun! together, they've murdered hundreds of thousands of people. they cause billions and billions of losses.

Thumb ice-man 20 December 2013, 10:18

Do you trade in penny stocks?

Thumb benzona 20 December 2013, 10:24


Thumb benzona 20 December 2013, 10:26

talking about penny. i started saving my 1,2,5 (euro) cents coins. they're worth more than their currency value in copper. lol

Thumb geha 20 December 2013, 10:23

he is the one giving cover to hizbushaitan, which is blocking any normal political life in favor of their Iranian masters.
wake up ft. it is about time you start seeing things properly.

Thumb ice-man 20 December 2013, 10:53

He's color challenged.... he sees only yellow.

Thumb FlameCatcher 20 December 2013, 13:15

Thank you M8 government for your perfect economical track record and bringing stability to Lebanon !

Hezbollah is creating a heaven for investors and job creation in Lebanon :) They are the protectors of Lebanon's flourishing economy ever since their wonderfully "divine victory" !

They have brought cheap labor to the country making Lebanon more competitive than China with 1.5M Syrians !

We can now convince companies like Apple to factories in Lebanon :)

Default-user-icon Hanoun (Guest) 20 December 2013, 14:48

what the use of Lebanon gaining billions and loosing his soul
democracy and arab spring for gulf countries now

Thumb eli-g 21 December 2013, 01:29

Failed state. Failed politicians. Failed civil society.