Cristina Casalinho, head of IGCP, believes the attractiveness of the Portuguese public debt will increase from now on, after Standard & Poor's increased the Republic's rating.
Portugal has been able to make its debt more appealing to international creditors, and that tendency will be accentuated even more over time, after Standard & Poor’s (S&P) removed the Portuguese Republic from the junk level, stated Cristina Casalinho, the president of the Portuguese Debt Management Agency (IGCP), this Tuesday, in the Portuguese Parliament.
“We were able to make our debt more appealing to several institutions. In the case of non-resident debt holders, there is now a return to past characteristics”, states Cristina Casalinho, referring to the fact that non-residents represented the majority of entities holding Portuguese debt.
And, in spite of having said that S&P’s decision is not enough to have an impact in Portugal’s financing costs, Casalinho now acknowledges that the decision will help this process. “An improvement in Portugal’s rating from S&P will strengthen this tendency” of having a more attractive debt, IGCP’s president anticipates.
On the debt management that needs to be made, Cristina Casalinho believes Portugal should seek to have a “reimbursement profile as broaden as possible” and an “ability to chose the best moment for us to go to the market”, maintaining, for that aim, a “significant liquidity buffer”. Cristina Casalinho anticipates that although public debt stands at historic peaks, close to 250 billion euros (equivalent to more than 132% of GDP), there is a downward trend in the debt trajectory for the future.