Global infrastructure sectors are improving a year on COVID-19 pandemic which may support a recovery in debt service coverage ratios in 2021, Moody's said in its latest report. Infrastructure and project finance sectors have a stable industry outlook owing to the increase in the percentage of vaccinated people globally, according to the report. The report added that the global economy is showing signs of recovery after a notable slowdown due to the pandemic. In 2020, Moody's had negative outlooks on 10 out of 19 economic and business sectors globally. Rating activity slowed down since the onset of the pandemic. In March and April 2020, Moody's took an average of about 150 rating actions per month globally, which quickly declined to around 60 per month from July to November 2020. "The slowdown in rating activity reflects the resilience of the infrastructure and project finance sector," stated the report. The report also mentioned that credit quality has remained robust during the pandemic, clarifying that Moody's downgraded about 11 percent of the project finance and infrastructure corporates that it rates globally, compared to 26 percent of non-financial companies. It added that about 66 percent of rating actions Moody's has taken since March 2020 were rating affirmations or confirmations. Demand is recovering in the majority of sectors globally as well, Moody's said. "Among infrastructure issuers, 79 percent have stable rating outlooks and three percent have a positive rating outlook," the report stated.
