Governments Do not Lulled Increase Debt Rating
Credit & Loan March 8th, 2010
Indonesia’s debt rating rise is not considered a major impact on the investment climate in the country. Economist Sustainable Development Indonesia (SDI) Dradjad H Wibowo said the increase was more influential ranking of the short-term capital flows.
“Indonesia should not really believe in these rankings,” he said in Jakarta on Monday (25/1/2010).
Dradjad added, should also be wary of hot funds short term. According to him, would do better to convince Indonesia proactive countries such as China to flow the funds for infrastructure financing. This, he says, can leverage significant investments in more than refer to the debt rating has dropped its credibility since the global financial crisis.
Rating agency Fitch Ratings raised Indonesia’s debt rating from BB to BB +. An increase of this debt ratings for long-term loans in foreign currency and rupiah.
Dradjad said, after the subprime crisis in the United States (subprime mortgage), confidence in ratings agencies have fallen so drastically. In the United States and Europe, he added, many financial market participants no longer trust the rating agencies.
In deciding domestic investment, real sector actors now rely more on business intuition, rather than an introduction to the market agencies. “Information such as the condition of the field and law enforcement infrastructure and market network they are also a consideration,” said Dradjad.
