Moody's rates Indonesia sukuks Baa2

Moody's Investors Service said it assigned Baa2 backed senior unsecured debt ratings to the planned dollar-denominated sukuks to be issued by the Government of Indonesia through Perusahaan Penerbit SBSN Indonesia III (PPSI III) under its existing $25 billion trust certificate issuance program.

The ratings apply to all the proposed tranche issuances, including a green sukuk tranche, Moody's said.

The notes will rank pari passu with all of Indonesia's current and future senior unsecured external debt, the agency said.

The proceeds will be used to finance or re-finance expenditure directly, including financing of eligible green projects for the green sukuk tranche, Moody's explained.

The payment obligations represented by the securities are ranked pari passu with other senior, unsecured debt issuances of the government, the agency noted.

The rating mirrors the government long-term issuer rating of Baa2 with a stable outlook.

The rating is underpinned by policy emphasis on macroeconomic stability that increases its resilience to shocks, Moody's said.

The sovereign's credit profile is supported by narrow fiscal deficits and low government debt ratios, the agency added.

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