Kazakhstan and Kazkommertsbank Upgraded

The ratings are: Kazakhstan Sovereign Risk Rating: Upgraded to B+ from B; Rating Outlook: Stable. Kazkommertsbank (Almaty, Kazakhstan): Short-Term Local Currency Debt Rating: Currently LC-2; Senior Debt Rating: Upgraded to B+ from B. The Rating upgrade is based on the continuation of economic reforms, which is underpinned by a new three-year International Monetary Fund (IMF) program, and a stable political environment. The government’s appropriate policy response to the economic difficulties of 1998 and early 1999, including the floating of the Tenge in April 1999, highlights the progress the country has made during its transition toward a free market economy. The formal re-election of the Kazakh president in January 1999 for another term should result in continued political stability, as well as policy continuity, particularly with respect to tight budgetary discipline, stringent monetary control and structural reforms. Kazakhstan’s current account deficit remains manageable, while its debt amortization schedule over the medium-term is light. As a result, the country’s external liquidity position should remain comfortable.

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