S&P gives Seychelles bonds B+

Standard & Poor's said it assigned its B+ long-term local currency debt rating to Seychelles' treasury bonds totaling Seychelles Rupee 3.2 billion.

The agency said that the rating applies to eight outstanding instruments issued in the period July 2003 to July 2006 with maturities ranging from three to 20 years, adding that proceeds of these bond issues are used for general budget funding purposes.

The agency added that the sovereign credit ratings on the Republic of Seychelles are foreign currency B/B and local currency B+/B. The outlook is stable.

S&P added that the ratings on the Seychelles are supported by the country's strong fiscal performance, which has seen robust surpluses delivered in recent years, entrenched political stability and high per capita income.

"These factors are balanced against an onerous public sector debt burden, multiple arrears on bilateral and multilateral loans, as well as the country's exchange rate regime that imposes considerable distortions, constrains growth and impairs external viability," S&P credit analyst Agost Benard of the sovereign ratings group said.

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