mast image

Impact Investing

IPE special report May 2018

Sections

Moody’s says Spain must tackle pension liabilities

SPAIN – Ratings agency Moody’s Investors Services says demographic change will present Spain with pension liabilities that “must be taken into account”.

"The continuing decline in the working age population, together with an increase in the old-age dependency ratio, will lead to growing future pension liabilities that must be taken into account,” says Moody’s senior analyst Alexander Kockerbeck in report on Spain’s credit health.

“There are further age-related expenditures that will increasingly weigh on budgets, such as healthcare costs," Kockerbeck said.

The agency called for stronger competition, inflation control and higher labour market efficiency to enable Spain to reduce regional disparities and to keep alive a “virtuous circle of wage restraint, solid GDP and employment growth and fiscal consolidation”.

“Important challenges remain, and the government has only started to address these in order to guarantee sustainable development of public finances in the long run," Kockerbeck said.

Moody’s gives Spain an Aaa rating with a stable outlook, due to an improvement in its fiscal position within the European
Monetary Union – alongside budgetary changes.

The comments come as the assets under management at Spanish occupational pension schemes are surging. Figures released by Inverco, the Spanish association of institutional investors and pension funds, show that they rose 12.31% to 21.15 billion euros at the end of 2002. And the number of occupational pension account holders rose 12.76%.

A recent survey by savings bank La Caixa found that pensions are the main worry for 60% of Spanish people over 65 years old.

Have your say

You must sign in to make a comment

IPE QUEST

Your first step in manager selection...

IPE Quest is a manager search facility that connects institutional investors and asset managers.

  • QN-2435

    Asset class: CLOs.
    Asset region: Global.
    Size: USD 50m.
    Closing date: 2018-05-22.

  • QN-2436

    Asset class: Real Estate - Core Open-ended Real Estate Equity Fund (non-listed).
    Asset region: Asia Pacific.
    Size: Approx. CHF 70-100m per investment.
    Closing date: 2018-05-25.

  • QN-2438

    Asset class: High Yield Bonds.
    Asset region: US.
    Size: USD 300 million.
    Closing date: 2018-05-25.

Begin Your Search Here