Credit Rating Increases

For the second year in a row, Nova Scotia's finances have received positive international recognition.

The highly respected Standard & Poor's Rating Services announced earlier today, Aug. 20, that it has raised its long-term issuer credit and senior unsecured debt ratings on the Province of Nova Scotia from A-minus to A. In 2003, the outlook increased from A minus negative outlook to A minus positive outlook.

"Nova Scotia taxpayers should take comfort in the knowledge that one of the most highly regarded bond rating agencies in the world continues to have confidence in the management of our province's finances," said Premier John Hamm. "Living within our means and balancing budgets each and every year will help keep our economy growing, which in turn helps government pay for the things that Nova Scotians care most about, such as health care and education."

According to the Standard & Poor's report, Nova Scotia's credit rating improved because of the following factors:

• the province's "sustained improvement in fiscal performance over the last four years";
• "the achievement of three consecutive balanced budgets due to the restraint measures undertaken by the (provincial) government to control budgetary expenditures";
• "the dramatic reduction in the foreign exchange exposure of Nova Scotia's debt to less than 17 per cent of total debt at the end of fiscal 2004 from more than 50 per cent in 1999 due to active debt management initiatives"; and
• "solid economic performance in the past five years" and a "rebounding" economy this year.

"Nova Scotians have made many sacrifices to realize this progress," added the premier. "But thanks to their hard work and commitment, government was able to make the tough choices to improve Nova Scotia's finances to a position not seen in a generation."

A copy of the full report can be found on the Standard & Poor's website at www.standardandpoors.com .