S&P Global Ratings on Friday affirmed its 'BB' long-term and 'B' short-term foreign and local currency sovereign credit ratings on Croatia with the country's outlook being assessed as stable.
The Standard & Poor's credit rating agency expects Croatia's economy to grow by over 3% in 2017 being "underpinned by robust domestic demand and further exports". This will help the government "to maintain a stronger budgetary position than before and continue reducing its still sizable debt burden."
"We are affirming our 'BB' long-term and 'B' short-term sovereign credit ratings on Croatia," according to the S&P decision.
"In 2017, we expect economic growth in Croatia will accelerate to slightly over 3.0% from 2.9% in 2016."
"The stable outlook balances our assessment of a still-high government debt burden and a short track record of implementing structural reforms and consolidating public finances against a strengthening economic recovery and improving external metrics on the back of continued financial sector external deleveraging."
The stable outlook reflects the S&P view of "balanced upside and downside risks to the ratings over the next 12 months".
In mid-December 2016, this international credit rating agency upgraded Croatia's outlook from negative to stable, which was the first positive headway for Croatia in the last nine years.
After that, the other two international credit ratings agencies -- Fitch and Moody's -- also changed Croatia's outlook to stable from negative. However, all the three agencies still keep Croatia's credit rating two notches below the investment level.