Thailand faces a downgrade of its BBB+ credit rating should the political unrest that has paralyzed a Bangkok business district and claimed 26 lives continue, Standard & Poor’s said.
“We do see the political uncertainty persisting, and likely will bring the credit indicators down from current levels in the next year or two,†Kim Eng Tan, director of sovereign ratings at S&P in Singapore, said in an interview on Bloomberg Television today. “If this prediction would come true, then likely there will be a rating downgrade.â€
S&P this month maintained its negative outlook on Thailand, where clashes between protesters and security forces have deterred investment and prompted countries from Australia to Canada to issue travel warnings. Thailand’s SET Index of stocks has slid 5.8 percent since April 7, when Prime Minister Abhisit Vejjajiva imposed emergency rule.
Protesters today readied themselves for a military offensive on the Bangkok business district they have shut down for 23 days after Abhisit called off peace talks and pledged to disperse them.
“If violence breaks out across the country, which is an event we do not expect at this time, it could also trigger a downward revision,†Tan said.
