Fitch says Ukraine politics may hit foreign investment

Credit ratings agency Fitch is concerned the collapse of Ukraine`s coalition government could deter foreign investment, it said on Wednesday, but saw no immediate risk of a ratings downgrade, according to Reuters.

Fitch director of emerging Europe sovereigns Andrew Colquhoun told Reuters the agency remained much more concerned about macroeconomic stresses within the Ukrainian economy such as double-digit inflation, rising external debt levels and its current-account deficit.

"There is a risk this will increase worries over political stability and deter foreign investment," he said. "Obviously, it would be positive for Ukraine`s creditworthiness to have a stable government able to take the necessary economic policies... we are much more worried about the macroeconomy."

He said it was too soon to say what kind of a new coalition if any would emerge and what that would mean, but saw no immediate ratings action by Fitch.

Fitch rates Ukraine BB- with a stable outlook.

Reuters