Moody's rates Belarus

Moody's Investors Service said it assigned sovereign ratings to the Republic of Belarus of Ba2 for its foreign-currency country ceiling and issuer ratings of B1 for foreign- and local-currency debt obligations.

The agency said it also assigned a B2 foreign-currency bank deposit ceiling, Not Prime short-term ratings and Baa3 local-currency country ceiling and local-currency bank deposit.

The outlook is stable.

The ceiling is based on the government bond rating and moderate likelihood of a payments moratorium in response to a government default, according to the agency.

"The ratings reflect both the recent macroeconomic successes of Belarus and the likelihood that rapidly increasing energy prices from 2007 onward will occasion substantial restructuring of enterprises and may lead to a deterioration of some macroeconomic indicators," Moody's vice president Jonathan Schiffer said in a written statement.

"Nevertheless, current account performance might prove vulnerable and foreign-currency revenues - already low by international standards - might not grow at the desired rate," Schiffer said.

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