Moody's rates Panama favorable

In its annual report on Panama, Moody's Investors Service said the country's Ba1 foreign-currency government bond rating and stable outlook are supported by a dynamic service sector that has served to shield the economy from the volatility observed in other countries in the region, and by a favorable debt profile.

Panama's A3 foreign-currency country ceiling for bonds assesses the risk of a disruption in the smooth functioning of the dollar payments system, the agency said.

Given dollarization's long tradition in Panama, Moody's said it sees limited risk for such disruption. In addition, because of dollarization, the foreign-currency country bond ceiling reflects the lack of transfer risk, the agency added.

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