Moody’s gives Spain Aaa rating

The rating agency Moody’s has highlighted the building up of a public pensions reserve fund is one of Spain’s top priorities, and believes that a funded system is an option; alongside the current ‘pay-as-you-go’ system. According to the firm, whilst Spain seems relatively well-placed to cope with the costs of an ageing population, some important challenges remain: ‘Due to the ageing of the Spanish society, to a decline in the working age population and a large increase in the old-age dependency ration, growing future pension liabilities must be taken into account.’ The ageing population will necessitate further reforms of pension and healthcare systems to cope with increasing budgetary costs of the demographic change. Moody’s gave Spain an Aaa rating with stable outlook backed by a ‘continuing improvement in the government’s fiscal position’ and ‘institutional changes in budgetary rules and processes’.

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• Topics
• Southern Europe
• Healthcare