Bangkok--18 Feb--Standard & Poor's Medium- and long-term commercial borrowing by national, regional, and local governments is projected to rise worldwide by 1.5% in 2008, to US$4.98 trillion from US$4.90 trillion in 2007, Standard & Poor's Ratings Services said in its fourth annual survey of government debt issuance. The report, entitled "Government Debt Issuance To Approach US$5 Trillion In 2008," provides regional breakdowns of issuance and total debt stock for all rated sovereigns and for local and regional governments (LRGs) worldwide. In addition to this comprehensive umbrella report, which discusses global trends, individual commentaries on 2008 issuance by sovereigns and LRGs in each geographic region are also available. "A marked increase in U.S. debt issuance at the federal and state levels due to fiscal stimulus measures and weaker economic growth should be offset, in large measure, by lower debt issuance by the central governments of Japan and Latin America," said John Chambers, chairman of Standard & Poor's sovereign rating committee. "Among other Group of Seven governments, Germany will trim its gross issuance, Canada and the U.K. will keep theirs in check, and France and Italy will see modest rises in their borrowing requirements," he added. Among the highlights detailed in the report, Standard & Poor's expects gross issuance of emerging market sovereigns to rise 5.4% in 2008, to US$757 billion. Of this group, Indonesia, Egypt, and Russia will see the largest percentage increase of their commercial debt issuance in dollar terms in 2008. Borrowing by subsovereign issuers is also expected to rise by 7.1% in 2008, to US$1.01 trillion. Higher borrowing by subsovereign issuers will emanate from the U.S. (up 7.3%), Japan (up 13.1%), and other Asian countries (up 33.9%), and will be only partly by offset by a fall in Europe (down 9.3%). "The increased LRG borrowing in the U.S. during 2008 will stem from deteriorating public finances, as states rely heavily on indirect taxes and municipalities on property taxes in a slowing economy," explained Mr. Chambers. "In Japan, the increased borrowing will come roughly equally from weakening fiscal positions at the subsovereign level and from higher levels of debt amortization," he said. According to Mr. Chambers, looking at nominal numbers for debt issuance tells only part of a fiscal story, and the fiscal stance is only one aspect of a sovereign's creditworthiness. However, as sovereign borrowing needs begin to trend up modestly, Standard & Poor's coincidentally sees what had been a five-year trend of sovereign upgrades outnumbering downgrades as nearing an end. "Among sovereign ratings, positive and negative outlooks are broadly balanced, suggesting that future rating actions will be more balanced, too," noted Mr. Chambers. "With credit fundamentals yielding balanced upward and downward pressure on most sovereign credit ratings, the environment for issuing US$5 trillion of government debt in 2008 should be more challenging than what prevailed in 2007, but still fairly benign," he concluded. The reports are available to subscribers of RatingsDirect, the real-time Web-based source for Standard & Poor's credit ratings, research, and risk analysis, at www.ratingsdirect.com. If you are not a RatingsDirect subscriber, you may purchase a copy of the report by calling (1) 212-438-9823 or sending an e-mail to [email protected]. Ratings information can also be found on Standard & Poor's public Web site at www.standardandpoors.com; under Credit Ratings in the left navigation bar, select Find a Rating, then Credit Ratings Search. Members of the media may request a copy of this report by contacting the media representative provided. Media Contacts: David Wargin, New York (212) 438-1579 [email protected] John Piecuch, Paris (33) 1-44-20-66-57 [email protected] Analyst Contacts: John Chambers, CFA, New York (1) 212-438-7344 David T Beers, London (44) 20-7176-7101 Benjamin Young, London (44) 20-7176-3574 Standard & Poor's, a division of The McGraw-Hill Companies (NYSE:MHP), is the world's foremost provider of financial market intelligence, including independent credit ratings, indices, risk evaluation, investment research and data. With approximately 8,500 employees, including wholly owned affiliates, located in 21 countries, Standard & Poor's is an essential part of the world's financial infrastructure and has played a leading role for more than 140 years in providing investors with the independent benchmarks they need to feel more confident about their investment and financial decisions. For more information, visit http://www.standardandpoors.com. Key Contacts: Americas Media Relations: (1) 212-438-6667 media_ [email protected] Americas Customer Service: (1) 212-438-7280 [email protected]