00:00For a country whose economy and government revenues remain heavily influenced by the energy sector,
00:06the outlook for natural gas production is particularly important.
00:10Moody's latest assessment says Trinidad and Tobago's credit position is supported by substantial financial buffers,
00:17including monies set aside in the Heritage and Stabilization Fund and cash held by the Treasury.
00:23Together, those assets amount to roughly 32% of GDP.
00:28Moody's says those resources give government greater capacity to absorb unexpected shocks,
00:35finance the budget and meet debt obligations when economic conditions come under pressure.
00:40But the assessment also looks ahead, particularly to what could happen as new and developing gas fields come on stream.
00:48Moody's expects domestic gas production to begin recovering by the end of 2027,
00:54with manatee, ginger and aphrodite fields expected to contribute to the increase.
01:00Production currently around 2.5 billion cubic feet per day is projected to rise to between 3 and 3.5
01:08billion cubic feet per day by 2028 and 2029.
01:13For Trinidad and Tobago, a higher gas production could mean more exports,
01:18greater foreign exchange earnings and additional support for economic growth.
01:22The country is also entering this period with a relatively strong external position, it says.
01:28Moody's expects liquid foreign exchange reserves to remain between 3.5 and 4 billion U.S. dollars,
01:34providing full coverage for external debt servicing and about four months of import under its methodology.
01:42That projection uses a narrower definition of reserves than the central bank's gross reserves figure.
01:48Gross foreign exchange reserves stood at 5.7 billion U.S. dollars in July, equivalent to 6.7 months of
01:55import cover.
01:56Moody's also says Trinidad and Tobago's debt burden remains broadly comparable with its rating pairs.
02:02In 2025, interest payments represented 12.7% of government revenue, slightly below the regional median of 13.1%.
02:11The agency says the government also benefits from a relatively deep domestic financial market
02:17and limited exposure to foreign currency debt, reducing some refinancing and exchange rate risks.
02:24And while the energy sector remains critical, Moody's points to institutional strength
02:28as another factor supporting the country's credit profile.
02:32It specifically highlights Trinidad and Tobago's constitutional system of checks and balances,
02:37political transitions, and governance indicators.
02:41The assessment follows Moody's decision in June to change Trinidad and Tobago's outlook
02:45from negative to stable while maintaining its BA2 credit rating.
02:51That stable outlook signals reduced immediate pressure on the country's credit profile,
02:55but it's not an upgrade.
02:57Trinidad and Tobago remains below investment grade, meaning continued fiscal consolidation,
03:03stronger non-energy revenues, and diversification of the economy
03:07will remain important to improving the country's credit standing.
03:10The finance minister says the latest assessment validates government's policy direction
03:15and its efforts to build a more stable and diversified economy.
03:19I wish you to worry, Ruknarain, TV6 News.
