EconMin Slams S&P over Downgrade
Monday, 16 December 2013
Bulgaria’s economy minister Dragomir Stoynev criticised sharply Standard & Poor’s over the recent downgrade of the outlook on the country's credit ratings, Capital Daily reported.
“I cannot accept purely political comments,” Stoynev said, as qyoted by the daily.
Standard & Poor's Ratings Services on Friday it revised its outlook on Bulgaria to negative from stable on weak growth prospects. At the same time, the rating agency affirmed its BBB/A-2 long- and short-term foreign and local currency sovereign credit ratings on the country.
The ratings agency also said the outlook revision reflects its view that Bulgaria's economic performance will remain under pressure as a result of weak lending by banks, reflecting low demand for credit given high real interest rates; a dearth of bankable projects, and financial constraints at the head office level of foreign parent banks; constrained investment growth over the period reflecting, among other factors, a low pick-up in foreign direct investment inflows; and high unemployment and an increasing proportion of long-term unemployment.
“We also believe that the uncertain political environment and the possibility of early elections will slow the adoption of reforms, weighing on potential economic output,” it added. “While the government has so far resisted popular protests to dissolve, we believe that increased pressure from civil society could complicate policymaking and raise the possibility of early elections.”