Originally posted on 23 Dec 2013

Credit rating agency Standard & Poor’s incited the ire of European Union officials last Friday when it snatched away the region’s top AAA rating, citing tensions between member states and a deterioration in their overall financial health, reported Katie Allen in the Guardian.

Downgrading the EU to AA+, the agency said the 28 countries’ combined creditworthiness had declined – but officials and leaders shot back with an assertion that the region had barely any outstanding debt relative to GDP.

Olli Rehn, the European commissioner for economic and monetary affairs, said: “The commission disagrees with S&P that member states’ obligations to the budget in a stress scenario are questionable. All member states have always, and also throughout the financial crisis, provided their expected contributions to the budget in full and in time.”

S&P, which recently cut its ratings on the Netherlands and France, said the wider region faced growing risks and “cohesion among EU members has lessened”.

“EU budgetary negotiations have become more contentious, signalling what we consider to be rising risks to the support of the EU from some member states,” the agency said.

There was more upbeat news for the Eurozone, however, with European commission data showing consumer confidence had picked up to a 29-month high this month.

Martin Pollins

Managing Director at One Smart Place
Martin Pollins is a Chartered Accountant and MBA with wide experience in corporate finance and business management. He has served on the boards of several companies, including those listed on the London Stock Exchange, AIM and OFEX. He is Chairman and Founder of OneSmartPlace and was a Council member of the Institute of Chartered Accountants in England and Wales from 1988 to 1996. He was managing partner of PRB Martin Pollins, based in Sussex, the first Accountancy firm to advertise on British television.He went on to create and launch the CharterGroup Partnership (the UK’s first Accountancy network) and then LawGroup UK (at the time, one of the largest networks of lawyers in the UK). In recent years, he helped to raise several £millions to fund British films such as The Da Vinci Code, Bridge of San Luis Rey, Head in the Clouds and Merchant of Venice with actors such as Charlize Theron, Robert De Niro, Al Pacino, F. Murray Abraham. Kathy Bates, Gabriel Byrne, Geraldine Chaplin, Tom Hanks, Ian McKellen, Audrey Tautou, Penélope Cruz, Steven Berkoff, Lynn Collins, Jeremy Irons, Joseph Fiennes and many more.

He has written over 700 business publications (see Glossaries at http://onesmartplace.com/resources/glossaries/) and is editor of Better Business Focus (see http://onesmartplace.com/resources/better-business-focus-magazine). His Blog, on a wide range of subjects can be found at: http://onesmartplace.com/blog/
Martin Pollins

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