Poland has estimated external bills of $100bn, says JLT

Poland has estimated external bills of around $100bn at a time when the cost of servicing debt payments is increasing, reported Jardine Lloyd Thompson.

‘Despite the recession, Moody's have announced that they will not downgrade Poland from its A2 rating but this may change in the future,’ said Dr. Elizabeth Stephens, head of credit and political risk analysis at JLT.

Poland is struggling to cope with the economic crisis with the zloty hitting its weakest level since the country joined the EU, falling 14% against the Euro this year alone. The Warsaw stock exchange is also trading at its lowest level for five years. This is according to the latest findings from the World Risk Review, a country risk ratings guide produced by JLT.

Stephens continued: ‘Poland has been downgrade this month in terms of Country Economic Risk, following similar downgrades for Turkey and Ukraine last month demonstrating the continuing pressure on peripheral countries in Eurozone as the European Central Bank has maintained interest rates at a higher level than those in the US and UK.’

‘Last month we highlighted that Sovereign Credit Risk was increasing for many Eurozone countries and pressure will intensify through the first half of this year in response to the huge supply of bonds that are due, leaving the Euro extremely vulnerable. We expect to see other Eurozone countries facing similar issues over the coming months as pressure spreads across Europe.’