S&P assigns AA to Qatar bonds

S&P said it assigned its AA long-term issue ratings to the proposed eurobonds to be issued by the State of Qatar (AA/stable/A-1+).

S&P expects the bonds will be issued in two series, of likely five and 10 years’ duration.

“With Qatar’s government revenues dipping to an estimated 32% of GDP in 2016 from an average of 42% of GDP over 2010-2014, due to lower hydrocarbon prices, we forecast a government budget deficit of 8% of GDP this year, including our estimates of a corrective fiscal response,” S&P said in a news release.

“This Eurobonds’ issuance is consistent with our expectation that Qatar will finance this deficit through debt, rather than by drawing upon its substantial assets,” the agency said.

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