Fitch downgrades El Salvador’s long-term IDR to ‘CCC’ from ‘B-‘
ambcrypto.comEl Salvador, the first country to legalize Bitcoin as a currency has maintained undeterred relations with Bitcoin. Over the years, the country has faced a countless number of critics for holding and acquiring BTC. In fact, the country’s finance ministerAlejandro Zelaya planned to issue its first “bitcoin bond” in March. Reportedly, the bond is “totally ready” for issuance between 15-20 March..
<p lang=«es» dir=«ltr» xml:lang=«es»>#ElSalvador | Fitch Ratings baja la calificación de El Salvador: “(…) debilitar las instituciones y concentrar poder en la presidencia han incrementado la imprevisibilidad de políticas públicas, y la adopción del bitcoin como moneda de curso legal ha agregado incertidumbre”. pic.twitter.com/KQjNfBWxRI— elsalvador.com (@elsalvadorcom) February 9, 2022
Rating agency Fitch’s recent grades for El Salvador’s BTC stance went further down south. It downgraded El Salvador’s long-term foreign-currency issuer default rating (IDR) to ‘CCC’ from ‘B-’. This happened just weeks before the country’s initiative to issue its Bitcoin bond. The report added, ‘weakening institutions and concentrating power in the presidency have increased the unpredictability of public policies.’
According to Fitch, the Central American nation faced close to $1.2 billion in external debt amortizations in 2023, with $800 million due in January. The country would face a financing gap of $1.2 billion in 2022, which would rise to $2.5 billion in 2023. This reflected heightened financing risks stemming from increased reliance on short-term debt.
“There is a high degree of uncertainty surrounding other sources of external financing, such as additional multilateral funding. Given doubts surrounding an IMF program, as well as the capacity to
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