Yerevan /Mediamax/. Fitch Ratings International Rating Agency has downgraded Armenia's Long-term foreign and local currency Issuer Default Ratings (IDR) to 'BB-' from 'BB': the Outlooks are Stable.

Mediamax informs, referring to Fitch Ratings, the agency has also downgraded the Country Ceiling to 'BB' from 'BB+' and affirmed the Short-term foreign currency IDR at 'B'.

According to Andrew Colquhoun, Director in Fitch's Sovereigns Group, despite a strong policy response supported by the international community, the severity of the shock has materially weakened Armenia's credit fundamentals and medium-term prospects.

Expert thinks that unlocking Armenia's economic potential and restoring strong and sustained growth necessary to reduce poverty and raise incomes will be much harder as a result of the crisis.

Stable Outlook reflects Fitch's assessment that the near-term risks to macroeconomic and financial stability are relatively low given the policy response and support from the international financial community.

Fitch projects GDP will contract 15% in 2009, the third-worst outcome expected for any Fitch-rated sovereign, highlighting the vulnerability of the small, narrowly-based and remittance-dependent economy. Fitch states that inflow of direct foreign investments made $27mln in Armenia in the first quarter of 2009, yielding 4 times to the analogous index in 2008.