SINGAPORE, Jan 19 — The impact of low global oil prices seems likely to remain modest to Malaysia, says Standard & Poor’s Ratings Services (S&P’s).

In its “Asia-Pacific Sovereign Rating Trends” report, S&P’s said Malaysia as the most important net energy exporter among rated sovereigns in Asia-Pacific, has its economy diversified.

S&P’s said global oil prices was most likely to remain low in 2016.

“This will provide support for economic activity and trade accounts for the  many oil importers in the region.

“It also means that policymakers will face less pressure in countries where there are remaining subsidies,” it said.

S&P’s expected sovereign credit trends in Asia-Pacific to remain largely  stable over the next year or two.

Its Credit Analyst Kim Eng Tan was quoted as saying that the sovereign ratings in the region have been very stable recently especially when compared with other regions.

“But rating movements in smaller sovereigns have contributed to an improvement in non-Gross Domestic Product-weighted rating by almost half a notch over the past year,” he added.

S&P’s said economic growth was unlikely to boost support for most Asia-Pacific sovereign credit ratings this year.

Moreover, sovereigns in emerging economies that rely on external funding could see higher financing cost amid a less-welcoming international funding environment.

Still, with energy prices likely to remain low, most sovereigns in the region were likely to face reduced risks to their external and fiscal metrics, it added. — Bernama