January 1, 2005
All Latin American countries except Chile, El Salvador and Mexico have junk ratings. Moody's and Fitch have Panama just one notch below investment grade, while Standard & Poor's has it two slots under, but an upgrade any time soon seems unlikely as rating agencies take a wait and see approach to the economic plan of President Martin Torrijos.
Moody's is keeping its Panama country ceiling at Baa1/P-2 (government bonds are rated Ba1) with a stable outlook. It points to the government's improved near-term growth prospects and moderate 2005-2006 financing. Fitch also maintains a stable outlook for Panama. It has rated Panama's long-term sovereign debt BB+ (short-term debt is rated B)
Although Panama is tantalizingly close to attaining investment-grade status, an upgrade may elude the country for some time yet.