T&T 'BBB-' Ratings Affirmed; Outlook Revised To Negative From Stable On Weaker Economy

• While Trinidad and Tobago's expected fiscal consolidation and its sizable government assets will continue to support the investment-grade rating of 'BBB-‘, on July 27, 2021, S&P Global Ratings revised its outlook on the Republic of Trinidad and Tobago to negative from stable. 
• The negative outlook incorporates the risks that poor economic performance and only modest GDP growth prospects prevent Trinidad and Tobago from recovering the economic resilience lost in recent years, as measured by GDP per capita. 
• The ratings could be lowered over the next two years if S&P believes that GDP growth is insufficient to recover the economic resilience, as measured by GDP per capita, that was lost following five years of falling per capita income. 
• There could also be a downward revision if the external debt position or the government’s debt burden deteriorates beyond expectations, or if the agency believes that the government's policy choices have weakened support for long-term sustainable public finances or balanced economic growth. 
• On the other hand, outlook could be revised to stable during the next 12-24 months if strong economic performance and favourable long-term GDP growth prospects help stabilize the recent erosion of the sovereign's financial profile. 
• A more resilient and prosperous economy, along with improved fiscal outcomes that stabilize the rise in the government's debt burden and ease external pressures, could also lead to a stable outlook.

(Source: S&P Global Ratings)