Debt crisis: War declared on rating agencies
7 July 2011
i – Portugal
“The government and [Portuguese President Anibal] Cavaco [Silva] are united. Against the rating agencies: a struggle without respite,” headlines the Portuguese daily i. The Lisbon daily notes the rapidity with which the government and the president, along with the politicians, bankers and businesspeople unanimously condemned the country’s downgrade by the Moody’s rating agency.
Público – Spain
“Europe (finally) in revolt against rating agencies,” headlines Spanish daily Público.”It’s time to end the oligarchy exercised by the three North American rating agencies around which there exists a network of interests that raise legitimate doubts about the objectivity of their dictates,” the paper says. A “generalised reaction of indignation,” says the paper’s leader, which explains that “the president of the European Commission, the German finance minister, the European Parliament and Spanish and Portuguese business leaders are leading a charge of unparalleled force against rating agencies and are calling for the creation of a European rating institution. But “creating alternative agencies is not enough, albeit European and honest ones, if no progress is made on European political union and if no far-reaching thought is given to the most adequate economic model,” the paper concludes.
Gazeta Wyborcza - Poland
“Moody’s sows seeds of terror,” runs the headline in Gazeta Wyborcza, which fears that “Portugal will not be able to reduce its budget deficit” and that the country will need, just like Greece, “a new financial infusion" from the International Monetary Fund and the European Union. The Polish daily quotes an expert who says that the rating agencies impede bailout operations in the eurozone by lowering the ratings of indebted countries “at the worse time for the markets”. It is thus urgent to put in place an international ratings agency under the influence of the EU. Otherwise, the paper concludes, “we will be forced to continue to believe institutions that warned us often about the crisis and that, once it arrived, only made things worse”.