Indonesia credit rating upgraded by Moody's

Indonesian laborers work at Light Rail Transit (LRT) construction site in Jakarta,Indonesia, Friday, April 13, 2018. Moody's upgraded Indonesia's credit rating on Friday due to increased confidence the government will maintain its recent track record of responsibly managing the national budget and interest rate policy. (AP Photo/Achmad Ibrahim)
Indonesian laborers work at Light Rail Transit (LRT) construction site in Jakarta, Indonesia, Friday, April 13, 2018. Moody's upgraded Indonesia's credit rating on Friday due to increased confidence the government will maintain its recent track record of responsibly managing the national budget and interest rate policy. (AP Photo/Achmad Ibrahim)
An Indonesian laborer works at Light Rail Transit (LRT) construction site in Jakarta,Indonesia, Friday, April 13, 2018. Moody's upgraded Indonesia's credit rating on Friday due to increased confidence the government will maintain its recent track record of responsibly managing the national budget and interest rate policy. (AP Photo/Achmad Ibrahim)
Cars line up in a traffic congestion next to Light Rapid Transit (LRT) in construction site, right, in Jakarta, Indonesia April 13, 2018. Moody's upgraded Indonesia's credit rating on Friday due to increased confidence the government will maintain its recent track record of responsibly managing the national budget and interest rate policy. (AP Photo/Achmad Ibrahim)

JAKARTA, Indonesia — Moody's upgraded Indonesia's credit rating on Friday due to increased confidence the government will maintain its recent track record of responsibly managing the national budget and interest rate policy.

In a boost for President Joko "Jokowi" Widodo's ambitious plans to carpet Indonesia with modern roads, ports, rail and airports, Moody's Investors Service said state-owned enterprises taking on more debt to fund those projects does not pose a "significant risk."

The upgrade raised Indonesia's sovereign credit rating to Baa2 from the lowest investment grade rating.

Citing improved economic management and the central bank's focus on controlling inflation, Moody's said "these policies and larger financial reserves are strengthening Indonesia's capacity to respond to shocks."

A higher credit rating can reduce the cost of borrowing overseas and encourage foreign investment.

Indonesia, with a population of more than 260 million, is Southeast Asia's largest economy but still struggles with high levels of childhood malnutrition, low educational standards and widespread corruption.

You may also interested in

Bali volcano ash drifts 4.7 miles high, airport...

Nov 29, 2017

An erupting volcano with a deadly history on Indonesia's Bali island has spread drifting ash 7,600...

Indonesia politician's graft trial delayed by...

Dec 13, 2017

A top Indonesian politician accused of involvement in one of the country's biggest corruption...

Greenpeace calls for investigation into Sinarmas...

Dec 20, 2017

Greenpeace has called for an investigation into the relationship between paper giant Sinarmas and...

Hillside crashes onto Indonesian farmers; 5 dead,...

Feb 23, 2018

Farmers were working in their rice paddies on the Indonesian island of Java, when the soggy...

Indonesia faces challenge to seizure of yacht...

Mar 19, 2018

Indonesian police say a luxury yacht seized as part of a U.S. probe into the alleged...