RAM Reaffirms Brunei's G A 1(PI) Rating On Sizeable Sovereign Reserves

KUALA LUMPUR, Jan 5 (Bernama) -- RAM Rating Services Bhd has reaffirmed Brunei's respective global- and ASEAN-scale ratings of g A 1(pi)/stable and sea AAA (pi)/stable. The ratings reflect the country's solid net asset position, around three times the size of its gross domestic product (GDP), backed by sizeable sovereign reserves, which provide a strong buffer against near-term fiscal and external deterioration stemming from sharply lower energy prices in recent years. In a statement, RAM said the government registered a substantial fiscal deficit of 16.9 per cent of GDP in 2016 and this was projected to remain wide at 14.6 per cent in 2017 in view of depressed hydrocarbon revenue and a still-high expenditure level. However, fiscal reserves are estimated to hold up firmly at 303.6 per cent of GDP as of end-2017. While Brunei's current account was expected to slip into a deficit of 4.1 per cent of GDP in 2017 owing to lower energy export receipts and increased imports in relation to large-scale projects, its foreign reserve holdings (24.9 per cent of GDP in 2015) were adequate to meet external liquidity needs, it said. -- BERNAMA