The international rating agency Fitch has upgraded Turkmenistan's long-term foreign currency issuer default rating (IDR) from B+ to BB- with a stable outlook. This decision is due to a significant improvement in the country’s sovereign balance sheet, growth in foreign exchange reserves and the government’s disciplined budget policy, reports the MIC.
According to Fitch's analysis, Turkmenistan's government net foreign assets (SNFA) are expected to rise to 55.9% of GDP by the end of 2024, the highest in its peer group.
The country's foreign exchange reserves continue to increase and, according to the agency's estimates, will be able to cover current external payments for almost 55 months, which is significantly higher than the average of countries with a BB rating.
Fitch forecasts Turkmenistan's government budget surplus to be 0.2% of GDP in 2024, close to the 2021-2023 average. Total government debt is expected to fall to 2.9% of GDP by the end of 2026, the lowest among BB-rated countries.
The agency also notes the significant growth of the Turkmenistan Stabilization Fund, which is projected to reach about 32 billion Turkmen manats (11% of GDP) by the end of 2024. These factors together indicate a strengthening of the country's financial position and justify an increase in its credit rating.