July 27, 1998
(Executive Council)

Province's credit rating upgraded

Premier Tobin said that today's credit rating upgrade by Dominion Bond Rating Service Limited is further proof of the confidence that exists in Newfoundland and Labrador's growing economy. DBRS, Canada's largest credit rating agency, today announced that it has upgraded the province's long term debt issues from BBB (minus) to BBB. As well, DBRS has upgraded the province's short term debt issues from R-2 (middle) to R-2 (high).

"This is the first time since 1973, 25 years, that the province has received an upgrade in its credit rating," said Premier Tobin. "This upgrade expresses Dominion Bond Rating's confidence in Newfoundland and Labrador, shows that we are an attractive place to do business, and is further proof that our economic performance will remain strong."

DBRS cites the government's continued commitment to fiscal management, debt stability and the province's strong prospects for future economic growth as reasons for the upgrade. In today's release, they noted that "recent economic performance has exceeded expectations and future prospects for improved conditions are compelling."

"Credit rating agencies are looking at our track record," noted the premier. "And it is obvious from today's upgrade that they like what they see. Our commitment to a balanced budget, stabilized debt levels, including the fact that we have addressed the unfunded pension liabilities, and expansion of resource industries such as offshore oil and gas, are all recognized by agencies like DBRS as major steps toward continued economic growth."

"Combine this upgrade with the encouraging GDP growth forecasts of major banks, add in the fact that there are 13,200 more jobs in the province over this time last year, and it is clear that Newfoundland and Labrador has turned a significant corner," said Premier Tobin.

Contact: Heidi Bonnell, (709) 729-3564.

1998 07 27                                    1:45 p.m.