CCI: BiH's credit rating falls into so-called "junk" category

The leading international agency for assessing the credit rating of states, "Standard&Poor's", confirmed Bosnia and Herzegovina's credit rating with a B rating and a stable outlook, as stated in the report "State of the Nation", published by the Centers for Civil Initiatives (CCI), after months of data collection, reports Patria agency.

This rating, according to the CCI report, falls into the so-called "junk" category and on a scale of 19 ratings, this rating is in 14th place.

"This means that out of 131 analyzed countries that have been assigned a rating, only 18 countries are ranked worse than BiH," the report states.

"Some of the countries that have the same credit rating as BiH are: Ethiopia, Rwanda, Uganda, Burkina Faso. For comparison, Senegal, Kenya, Papua New Guinea, which have a B+ rating, have a better credit rating than BiH. Some countries from the region, namely Albania and Montenegro, are also in this category, while Slovenia has an A+ rating, which means it is 9 levels above BiH."

Economists explain credit rating as an assessment of the creditworthiness of a debtor, in this case a country, in general terms or with regard to a specific debt or financial obligation.

"Therefore, besides assessing the possibilities and willingness of a country's government to service its debt, on time and in full, the credit rating is accepted as one of the relevant criteria taken into account when planning to invest in a particular country. Letter designations are usually given for a country's creditworthiness. The closer the letters are to the beginning of the alphabet, the better the rating. In addition to this, plus (+) and minus (-) signs are added to the ratings, indicating the country's tendency towards a better rating (+) or worse (-), or without designations, which means the country is stable in a particular category," the CCI states.

A poor credit rating is one of the primary reasons why major investors bypass Bosnia and Herzegovina, writes Patria.