(Reuters) - S&P Global on Friday upgraded its long-term sovereign credit rating on Greece by a notch to ‘BB-‘ from ‘B+’, saying that the remaining capital controls were removed without any adverse impact and on receding budgetary risks.
The ratings agency also said that budgetary risks have subsided following the Greek State Council’s decisions on previous reform regarding civil servants’ holiday bonuses and pensions.
Greece, which implemented capital controls during the 2015 financial crisis, announced their removal in August this year. The move signaled the southeast European country’s continuing return to stability after the tumult of three international bailouts since 2010.
“We believe the removal of restrictions will improve confidence in the economy, while reducing related financial costs, which is particularly relevant for the private-sector business environment,” S&P Global Ratings said.
S&P said over the next three years it expects Greece’s economic growth will surpass the euro zone average and its economic performance to remain balanced, fueled mainly by domestic demand and exports.
The agency's positive outlook on Greece bit.ly/31IGVWR indicates the ratings could be raised within the next 12 months if the country continues implementing structural reforms that strengthen its economic growth potential and public finance sustainability.
Reporting by Nishara Karuvalli Pathikkal; Editing by Shailesh Kuber