Debt Issue Amount Not Only Factor for Japan Rating: Fitch Official

London, Dec. 17 (Jiji Press)--A senior Fitch Ratings official
indicated Thursday that it will not change its ratings on Japan by only
assessing the Japanese government's plan to issue a maximum of about 44
trillion yen worth of bonds in fiscal 2010.
The planned bond issue figure "alone is not sufficient to reassess
Japan's rating," James McCormack, head of Asia-Pacific sovereign ratings,
told Jiji Press.
The Japanese government of Prime Minister Yukio Hatoyama earlier
this week decided to limit its fiscal 2010 bond issues below about 44
trillion yen.
"There are other critical variables to consider as well, including
GDP (gross domestic product) growth and interest rates," McCormack said.
"Together, the fiscal balance, interest rates and GDP growth will determine"
how the debt-to-GDP ratio develops over time, he added.
Japan's government debt has been among the highest in the world for
a long period, he pointed out.
But Japanese interest rates are very low, "allowing the government
to service its debt with an interest burden similar to sovereigns with much
lower debt stocks," he noted. "This is a critical factor in assessing
Japan's debt tolerance."
McCormack said that Japan is unlikely to return to recession
although its GDP growth is estimated to be weaker in Japan than in the
United States.
Japan's GDP is seen to grow 1.0 pct in 2010 after shrinking 5.4 pct
this year, he said.