LatinNews Daily - 16 March 2020

* International credit ratings agency Moody’s Investor Service has changed its outlook on the Salvadorean government’s ratings to 'positive' from 'stable'. It cites as key factors: materially reduced government liquidity risks; and improved business conditions that could lift private investment and economic growth (which has averaged 2.4% annually from 2010-2019). As regards the first point, Moody’s notes that the new administration led by President Nayib Bukele (which took office in June 2019) was “able to secure the necessary votes in the legislative assembly to pass its budget proposal last December and also to contract long-term debt to fund this year's fiscal deficit”. It describes this development as “significant” given Bukele has “only a small party representation in the legislative assembly and a two-thirds majority vote is required to secure long-term financing”. As regards the second point, Moody’s notes that the new administration has taken steps to jumpstart private investment. As well as “improved dialogue with the business community” it highlights a reduction in “red tape and regulatory bottlenecks”; the creation of a new ministry dedicated to facilitating private sector investment; and efforts to improve public security.

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