From the Korea Times:
Missile Tests Won’t Have Major Impact on Korean Ratings: S&P
By Yoon Ja-young
Standard & Poor’s (S&P) said that North Korea’s test launches of missiles earlier in the day will not drastically affect South Korea’s economic prospects.
“At this stage, it (North Korea’s missile launch) will not directly and significantly affect the macroeconomic outlook and fiscal position of South Korea,” Takahira Ogawa, a sovereign credit analyst and director at S&P said.
“Politically, the launches are likely to make negotiations in the six-party talks more difficult, and could possibly lead to further economic sanctions by the U.S. and Japan beyond a six-month freeze on the ferry service between North Korea and Japan announced this morning,” Ogawa added.
The U.S. ratings agency noted that its baseline scenario on the North Korea issue remains that “a peaceful solution will be found, although it could be protracted and may not be comprehensive.”
It also hinted that the North Korean nuclear issue has been taken into account in the credit assessment of Asia’s fourth-largest economy, noting that it “has long assumed that relations with North Korea would remain difficult.”
“Geopolitical risks have figured as the most critical risk factor weighing on South Korea’s credit standing,” S&P said.
