Standard & Poor's Ratings Services said on Monday that Pakistan's parliamentary election results set the stage for longer-term stability of our 'B-' sovereign credit rating on the country.
In a statement, S&P said that this was needed to stabilise external finances and to provide the policy framework for necessary fiscal and energy sector reforms. If successful, these efforts will underpin the continued stability of the sovereign ratings at the current 'B-' level.
The May 11 elections were the first in the country's history in which an elected Government handed power to another elected government.
"This is a key achievement for Pakistan's maturing democracy, in the face of general economic malaise, widespread and incessant sectarian and political violence, large-scale domestic insurgencies, and ongoing tension with neighbouring India," said S&P's credit analyst Agost Benard.
In an earlier commentary --"Successful Elections Are Crucial As Pakistan's Balance Of Payments Pressures Mount," (published on April 4 this year), S&P had outlined its view that timely, successful, and credible elections were essential for Pakistan to deliver a government with a reasonable chance of tackling the country's economic imbalances, including a looming balance of payments crisis.
"We believe the election outcome puts the incoming government in good stead to sew up an IMF deal soon," Benard quoted to have said in the statement.