Fitch revises Panama outlook to negative

Fitch Ratings said it affirmed Panama's long-term foreign-currency issuer default rating at BBB- and revised its outlook to negative from stable. The agency upgraded the country ceiling to AA- from A-.

“The negative outlook reflects persistent fiscal pressures and uncertain prospects for consolidation. The government has relied heavily on one-off measures and accounting maneuvers to reduce the fiscal deficits over the last year. Furthermore, fuel and electricity subsidies and a rising interest bill are pressuring the fiscal deficit in 2023, and a large expansion of budgetary spending in 2024 increases the risk of further slippage that could result in a rising trajectory of government debt,” Fitch said in a press release.

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