CaribWorldNews, NEW YORK, NY, Tues. Nov. 3, 2009: Top ratings agency, Standard and Poor`s is keeping a negative outlook on Jamaica`s credit following the resignation of the island`s central bank governor.
Standard & Poor`s on Monday downgraded Jamaica one notch, to `CCC` from `CCC-plus,` signaling the growing risk of a debt exchange operation that could be an event of selective default.
`Jamaica`s severe fiscal situation as well as the vulnerabilities in the government`s debt profile may give it incentives to renegotiate with its creditors, particularly its resident creditors that hold the larger bulk of Jamaican debt,` S&P said in a statement.
`Since then, the government`s room to maneuver continues to narrow as it becomes increasingly difficult to further cut public expenditures in order to sustain an interest burden of about 60 percent of general government revenue.`
The ratings downgrade comes as the Jamaica Bruce Golding administration is seeking a loan from the International Monetary Fund.