S&P not worried about Poland's debt

Global ratings agency S&P has no concerns about the level of Poland's public debt, according to one of the company’s chief analysts. 

"At the moment, we do not have any concerns over Poland's public debt sustainability,” Karen Vartapetov, chief analyst responsible for Poland's ratings, told PAP.

“Fiscal metrics were relatively strong pre-Covid-19, affording space for a countercyclical fiscal policy response,” he continued. “In 2021, we project general government fiscal deficits at slightly above 5 percent of GDP and net debt at some 59 percent of GDP. Our fiscal projections are conservative, and we do not expect debt-to-GDP ratio to return to the declining path it was on before the pandemic, until 2023. But even higher public leverage post-Covid-19 (at around 60 percent of GDP) would still be moderate in the global context.

"Our ratings factor includes both the level of government debt and its profile,” he went on to say. “While the debt level has picked up, its profile has continued to improve. In particular, the effective cost of servicing debt has been declining. The Polish government's ability to fund itself in local currency at low cost and reasonably long maturities is a rating strength. In this context, the declining share of the foreign currency denominated debt provides further evidence to support this view."

Of the key three global ratings agencies, Moody's has offered the best credit rating for Poland, at A2. Both S&P and Fitch have assigned the A- rating to the country, one notch lower than Moody's. The outlooks of all three ratings are stable.