S&P rates Mongolia notes BB-

Standard & Poor's said it assigned a long-term foreign-currency issue rating of BB- to a global medium-term note program of up to $5 billion by the government of Mongolia, along with a BB- rating to the proposed first drawdown of the program.

The agency said it has equalized the rating on the program with the foreign-currency sovereign rating on Mongolia.

The bond represents direct, unconditional obligations of the sovereign, S&P said, and ranks equally with the government's other unsecured and unsubordinated debt obligations.

The first drawdown will be denominated in dollars with principal and interest payments being made in the same currency.

The proceeds will be used for infrastructure and utility projects, the agency said.

The ratings reflect the country's underdeveloped, resource-driven economy and its weak policy environment, S&P said.

The economy's strong medium-term growth prospects and low general government debt and interest expenses temper these weaknesses, the agency added.

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