Fitch Affirms Flanders’ AA Rating but Revises Outlook to Negative
On Friday, 17 March 2023, Fitch revised the outlook on the Flemish Community’s rating to negative from stable. Fitch affirmed the AA long-term rating. The short-term rating remained at F1+.
The revision in outlook reflects that on the Belgian sovereign. Belgium’s outlook was revised to negative from stable on 10 March 2023. Fitch considers that the Flemish Community may not be rated more than one notch above the Belgium state (AA-/Negative).
Fitch’s latest report proves that Flanders has a solid economy with indicators above the Belgian and European average. Five out of the six Key Risk Factors (KRFs) were assessed as ‘stronger’:
- revenue robustness
- revenue adjustability
- expenditure sustainability
- liabilities & liquidity robustness
- liabilities & liquidity flexibility
Flanders’ rating is the highest of all Belgian regions and communities and is even one notch above the Belgian federal rating. Flanders thus remains one of the few European regions to which Fitch assigned a rating higher than that of the sovereign.
The current contract with Fitch runs from 1 March 2020 to 29 February 2024.