S&P: Serbia unaffected

Standard & Poor's said that the outcome of the Serbian general election held yesterday does not have an immediate impact on the sovereign credit ratings on the Republic of Serbia (BB-/negative/B).

However, the eventual governing coalition's response to the political and macroeconomic risks facing the country will be a crucial factor for the ratings, the agency said.

These risks include the heightened polarization of the political environment following Kosovo's independence, which may adversely affect the country's prospects for E.U. integration and foreign investor sentiment, the agency said.

If a coalition were formed that causes increased political volatility, or halts economic reforms and discards the benefits of eventual E.U. membership, pressure on the ratings could follow, the agency added.

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