Fitch cuts Karelia view to positive

Fitch Ratings said it changed the outlooks on Republic of Karelia's international and national long-term ratings to positive from stable. Its international long-term rating is affirmed at BB-, short-term rating at B and national long-term rating at A+(rus).

The positive outlook reflects an expectation that continued prudent fiscal discipline and economic development will support revenue growth, allowing the region to overcome operating expenditure pressures and improve budget performance in near future, the agency said.

An upgrade could be triggered by a consolidation of its strong budgetary performance, with operating and current margins above 10% over the next two years, the agency said, and continued debt restraint.

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