November 21, 2019 / 11:54 PM / 19 days ago

Fitch downgrades Bolivia amid political instability

Nov 21 (Reuters) - Global credit rating agency Fitch Ratings has downgraded Bolivia’s ratings to ‘B+’ from ‘BB-‘, citing macroeconomic risks, which have been intensified by the recent political and social instability in the country.

The cut in Bolivia’s long-term foreign currency issuer default rating comes as street violence in the country has killed 32 people since disputed elections in October.

Evo Morales, the nation’s long-term leftist leader, stepped down on Nov. 10 under pressure from security forces, protesters, civil groups and allies, after an international audit that found serious irregularities in the election count and cast doubt on his announced outright victory.

Fitch’s outlook on Bolivia remained negative, the agency noted, adding that it expects the economy’s growth to slow to 2.5% in 2019 from 4.2% in 2018.

The fall in economic growth will be the result of the rapidly narrowing scope to sustain expansionary policies that have supported it in the past years, Fitch said on Thursday.

Currently led by a caretaker government, Bolivia is grappling to mend stark divisions between supporters of Morales and his opponents seeking to move beyond his nearly 14-year rule. New elections are yet to be scheduled by the interim government.

Having been granted asylum in Mexico, Morales has said he was toppled by a coup and has suggested he would return. (Reporting by Kanishka Singh in Bengaluru; Editing by Daniel Wallis)

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