Fitch has affirmed Bahrain’s long-term foreign and local currency issuer default ratings (IDRs) at ‘A’ and ‘A+’ respectively, short-term foreign currency IDR at ‘F1′ and country ceiling at ‘A+’. The outlooks on the long-term IDRs are stable.
The stable outlook reflects the continued resilience of Bahrain’s economy and the banking sector to the stresses from the global downturn and regional property markets over the last two years. It also reflects the strong starting point for public finances in the context of the government’s planned fiscal expansion during 2011-12.
As per Fitch forecasts, the central government fiscal deficit will remain a wide 5.5 per cent of GDP on average in 2011-12, and debt will increase to 38 per cent of GDP by 2012, from 16.4 per cent in 2008.
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