US infrastructure expansion brings mix of credit implications - Moody's |
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Fri, 30 Nov 2007 07:25
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BANGALORE (Thomson Financial) - Moody's Investors Service said the key infrastructure capacity expansion issues facing the US would face many risks, but the credit implications also include positive factors.The four areas -- capacity expansion of ports, airports, power generation and toll roads -- will need substantial capital investment and will experience the risks that come with a lot more borrowing.However, if expansion keeps pace with demand growth it should strengthen credit worth, the ratings agency said.For instance, the new tolling initiatives brings a variety of rating implications, many of them negative, but technology enhancements and supportive legislation, coupled with the funding pressures faced by many states, will encourage the use of tolls in new and innovative ways, Moody's said.On US airports, the agency said capacity constraints challenge their creditworthiness but this may be overshadowed by a key positive credit factor for their ratings the need for new capacity.This is driven by a healthy, even booming, air travel industry that is expected to see demand growth well into the next decade, Moody's said.TFN.newsdesk@thomson.comfaj/tsmCOPYRIGHTCopyright Thomson Financial News Limited 2007. All rights reserved.The copying, republication or redistribution of Thomson Financial News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Financial News.
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