Monterey, NL. The agency S&P Global Ratings confirmed the national scale credit rating of ‘mxA‘ to the state of New Lion and upgraded its outlook from negative to stable.
The rating agency anticipates that the government of New Lion will consistently reverse the deterioration in budget performance caused by the shocks caused by the covid-19 pandemic.
In a statement, he explained that the continuous commitment of the financial administration to guarantee the fiscal sustainability of the state, together with a strengthening of the practices of control of expenses and own income, have allowed New Lion overcome the previously forecast fiscal deterioration.
The rating of S&P Global Ratings It also considers the expectation that Nuevo León maintains a moderate growth in its debt load, and a gradual relief of its liquidity position.
On the other hand, the rating also considers that Nuevo León has a solid local economy, which is based on the dynamism of its own income and compares positively, in per capita terms, with its national peers.
The stable outlook reflects that the government of Nuevo León has a healthy budget performance, along with disciplined financial policies, which will allow it to contain the level of the debt burden and gradually reduce the use of short-term debt over the next two years. he added.
S&P Global Ratings indicated that a positive rating action could be taken in the next 12 to 18 months, if Nuevo León strengthens its budget performance above expectations, as a result of a constant increase in its own revenues and/or greater containment in the operating expense pressure.
The rating agency expects the economy of New Lion recover faster than the national average, despite the severe impact of the pandemic, that activity will gradually pick up in the coming years as a result of greater demand from the United States and the execution of various private investment projects announced in the State.
“The solid economy of Nuevo León has driven the growth of its own revenues, which we expect to be around 19% of total revenues in the next two years,” the rating agency said in the statement.
(With information from Lourdes Flores).