Moody’s puts Bulgaria on review for upgrade

Moody's put Bulgaria on review for a possible ratings upgrade on Tuesday, praising the government's fiscal policy and improvements in institutional strength.
It cited the centre-right government's efforts to cut the fiscal deficit below three percent of gross domestic product this year, better use of European Union aid and steps to crack down on widespread crime and corruption.
The ratings agency currently rates Bulgaria at Baa3, its lowest investment grade rank.
"Spending restraint and the lack of a need to provide financial support to the banking sector during the global economic crisis allowed the Bulgarian government to maintain its favorable financial metrics over the past few years," it said in a statement.
Bulgaria's economy grew just 0.2% in 2010 after a deep recession. The government froze public pay and pensions and slashed public spending to stop the budget deficit spiralling out of control and to preserve the country's currency peg to the euro.
The Moody's review will focus on public finances, given the importance of maintaining low debt for the credibility of Bulgaria's currency peg.
It will also examine the government's efforts to crack down on corruption, reduce crime and enforce border security to assess if these programmes are likely to be successful and how quickly improvements could materialise.