PARIS, Aug 17 (AFP) - The international rating agency Standard and Poor`s said Tuesday it had raised its rating on Turkey`s debt because of improved macroeconomic stability.
S and P said in a statement it had lifted its rating on long-term Turkish government debt denominated in foreign currencies to BB minus -- considered specualtive by investors -- from B plus.
It also raised its rating on long-term government debt denominated in lira to BB from BB minus previously. The outlook for further changes in the two ratings was stable, S and P said.
"The sovereign upgrade reflects the progress Turkey is making toward durable macroeconomic stability, and the country`s expected adherence to a strict macroeconomic program beyond 2004, which would result in further fiscal improvement, disinflation, a more sustainable public debt burden, and reduced vulnerability to market sentiment," Standard and Poor`s credit analyst Konrad Reuss said in the statement.
Turkey, with the aid of the International Monetary Fund, is emerging from a 2002 financial crisis through major economic restructuring.
S and P said that both political and economic risks to stability were currently balanced.
"On the political front, the challenges faced by the government are mitigated by its large parliamentary majority.
"On the economic front, the government has made clear its commitment to continued prudent policies beyond the current IMF program", Reuss said.
S and P left its rating on short-term Turkish government debt in foreign currencies and lira unchanged at B.