Greek PM renews attack on credit rating agencies over new downgrade of Greece by Standard and Poor's

Wed March30, 2011 05:42:42
Greek Prime Minister George Papandreou (L) attends a press conference for the meeting of the Progressive Alliance of Socialists and Democrats of the European Parliament in Athens, capital of Greece, March 29, 2011. Papandreou renewed his attack on international credit rating agencies Tuesday after the new downgrade of Greece's credit rating by Standard and Poor's. (Xinhua/Marios Lolos)

ATHENS, March 29 (Xinhua)-- Greek Prime Minister George Papandreou renewed his attack on international credit rating agencies Tuesday after the new downgrade of Greece's credit rating by Standard and Poor's.

The agency slashed once again the country's rating by two notches to BB- from the previous BB+ Tuesday, arguing that Greece will most probably need more foreign aid eventually to overcome an acute debt crisis which led it to the brink of default last spring.

"The decision on Standard and Poor's does not reflect the efforts we make to put our finances in order," said Papandreou during a press conference held in Athens for the meeting of the Progressive Alliance of Socialists and Democrats of the European Parliament.

With the group's head Martin Schulz by his side, the Greek Premier and Socialist International leader repeated strong criticism against rating agencies, "which went from the bubble of euphoria to the panic of risk."

International rating agencies reflect the systemic flaws of the European common currency, Papandreou and Schulz acknowledged. But they also make markets panic without proper justification sometimes, the Greek PM stressed.

"Greece is downgraded not because of its policies, but because EU reaction to the crisis is still considered not bold enough, too little too late," added the Greek leader, noting that a wide gap between markets and politics remains, making people wonder over who governs our world.

Reminding that the same agencies rated positively toxic bonds which created the current international economic crisis, Papandreou raised again the issue of lack of accountability of these agencies and the need that banks bear their burden in the crisis and contribute to efforts to restore growth in Greece, Europe and across the globe.

"Greece aims to fully return to the international markets as early as possible, so we will not have to resort to the new permanent European Stability Mechanism after 2013," he said.

Since last May Greece has not borrowed from international markets on prohibitively high interest rates, but been depending on a multi-billion euro aid package from the European Union and the International Monetary Fund to exit the crisis by 2013 through harsh austerity measures and structural reforms.

Despite progress, skepticism remains amongst foreign analysts in ratings agencies whether Greece will overcome the crisis without further support.

Expressing strong solidarity to Greece over the Herculean task under way, German Socialist Schulz criticized German Chancellor Angela Merkel's stance over the Greek crisis, stressing that "no country within the EU can teach lessons to others and aim development on its own."

Schulz voiced confidence that Greece will exit the crisis, based on the result of the latest EU summit in Brussels last week, "which revealed that more and more conservatives across EU realize that the only way out of the crisis is unity and solidarity."
Editor: Mu Xuequan