MOODY’S affirmed Trinidad and Tobago’s credit rating at Ba2, maintaining a Stable outlook on December 16, 2024.
This decision highlights the country’s return to sustained economic growth, largely driven by the burgeoning non-energy sector, the Ministry of Finance stated on Wednesday.
Despite a rise in the fiscal deficit to 4.8% of GDP due to lower-than-expected energy revenues in 2024, the rating agency acknowledged the government’s strides in diversifying fiscal revenue.
A key component of these efforts is the establishment of the Trinidad and Tobago Revenue Authority (TTRA) set for 2025, the release stated.
Moody’s noted that potential fiscal risks are offset by substantial financial buffers, including the Heritage and Stabilisation Fund and cash reserves exceeding 40% of GDP.
Finance Minister Colm Imbert stated that Moody’s recognition underscores the nation’s successful diversification and the strength of its economic reforms. He emphasised the importance of these reforms in bolstering the country’s fiscal and economic resilience.
The Stable outlook on the Ba2 rating reflects concerns about diminishing foreign-exchange reserves caused by falling energy revenues. However, Moody’s pointed out that Shell T&T’s recent investment decision alleviates uncertainty regarding future hydrocarbon production, with an anticipated boost in natural gas output by 2027.
Minister Imbert highlighted Trinidad and Tobago’s growing appeal to oil and gas investors, with new projects like the Osprey and Cascadura fields poised to enhance production and economic growth.
International confidence in Trinidad and Tobago’s economic stability is further evidenced by the successful issuance of a $750 million bond in June 2024 at a competitive rate. The country’s debt yields are notably lower than those of higher-rated nations like Panama and Colombia.
Trinidad and Tobago also maintains investment-grade ratings of BBB- from S&P and AA from CariCRIS, reflecting its robust economic fundamentals and prudent fiscal management. The medium-term outlook remains promising, according to Minister Imbert.
