Fitch upgrades Ireland's rating to AA from AA-

ISTANBUL

Fitch Ratings said Friday it upgraded Ireland's long-term foreign-currency rating to AA from AA- with a stable outlook.

"Ireland has had a very strong budget performance since 2022, which we expect to continue over the forecast horizon," the rating agency said in a statement.

While Ireland's budget surplus was €8.6 billion ($9.34 billion) in 2022 and €8.3 billion in 2023, which was 1.7% of GDP, the agency's forecast for 2024 and 2025 is in the range of €4 - €5 billion.

"Ireland has a prudent domestic fiscal framework designed to mitigate risks from the large and highly-concentrated windfall corporate tax revenue," said the statement. "The government estimates that windfall corporation tax revenue from multinational enterprises (MNE) reached €11.2 billion in 2023 and expects it to remain above €11 billion in 2024 and 2025."

Public debt, meanwhile, has been on a steadily declining trend, primarily due to sustained budget surpluses, said the agency.

Fitch Ratings, in addition, said it affirmed Greece's long-term foreign-currency rating at 'BBB-' with a stable outlook.

It said separately that Greece's ratings reflect income per capita levels and governance indicators that are well above the 'BBB' median, while the country's policy credibility is supported by its EU and eurozone membership.

The agency said it expects a continued reduction in Greece's headline general government deficit to 0.8% of GDP in 2025, and forecasts primary surpluses averaging 2.3% in 2024 - 2025, up from 1.9% in 2023.

Greece's economy is estimated to grow 2.3% in 2024 and 2.4% in 2025, up from 2% in 2023, and well above the eurozone average of 1.1%, according to Fitch Ratings.

"Economic growth will be driven by real-wage increases, continued employment growth and solid investment," said the statement.