S&P RATES GEORGIA AT B+ LONG TERM, B SHORT TERM

UNCLAS TBILISI 003216 SIPDIS DEPT PLEASE PASS EB/IFD/DIA E.O. 12958: N/A TAGS: EFIN ECON GG SUBJECT: S&P RATES GEORGIA AT B+ LONG TERM, B SHORT TERM ¶1. On December 6, Standard & Poor's Ratings Services assigned its 'B ' long-term and 'B' short-term sovereign credit ratings to the government of Georgia. This is Georgia's first sovereign credit rating. S&P says the ratings are "supported by the government's strong political commitment to prudent financial policies and market-oriented structural changes, including tax reforms and the recent acceleration of privatization. The ratings are constrained by weak external liquidiy, still-high inflation, and substantial infrastructure development needs, in the context of a poor institutional framework and political uncertainty arising from regional conflicts." ¶2. Comment: GoG officials were pleased with the December 6 rating, which puts a stamp of approval on their recent efforts. According to a US Treasury advisor to the GoG, S&P's "outlook positive" distinction means the rating can be reviewed soon. End Comment. TEFFT