Opposition: Rating Downgrade by S&P Confirms Poor Fiscal Policy

Bratislava, 26 April (TASR) - The downgrade of Slovakia's rating by the Standard and Poor's (S&P) agency is proof of the government's poor fiscal policy, with Finance Minister Ladislav Kamenicky (Smer-SD) being primarily responsible for this, representatives of several opposition parties stated on Saturday (25 April), advising Kamenicky to resign. Ludovit Odor, an MEP for the opposition Progressive Slovakia (PS), said the lowered rating has a real impact on lives in Slovakia, meaning higher government debt repayments, less money in the budget, and fewer investors. "This decision only confirms what we've been saying for a long time: despite three attempts, consolidation has hardly taken place at all. When you improve public finances, the rating should be better, not worse," said Odor, calling on Kamenicky to resign, as this would be the first right thing to do for the Slovak economy. The opposition Christian Democrats said the lowered rating is very bad news for Slovakia, showing that the state is not capable of effectively recovering its public finances. "Consolidation was supposed to heal public finances, but after three years, the deficit is still at €6 billion and the debt continues to grow. Instead of recovery, there's a loss of trust. And this happened precisely because of the finance minister's poor fiscal policy," stated KDH MP and House economic committee member Rastislav Kratky, adding that this time the global situation had only a secondary impact on the rating. The opposition Freedom and Solidarity (SaS) added to the criticism, saying that the government's consolidation packages are not working and that Slovak people were not only deceived, but are now burdened with even more debt. "The government is slowing down growth with its consolidation measures, higher VAT and uncertainty of its own making. If the government doesn't act quickly and responsibly, we'll face further downgrades of the rating, more expensive government borrowing, and eventually even greater pressure to increase taxes for people and businesses," stated SaS MP and vice-chair of the House finance committee Marian Viskupic. He added that Slovakia deserves a more responsible government that will kick-start economic growth and stop tax hikes. On Friday (24 April), the Standard and Poor's (S&P) rating agency has lowered Slovakia's rating from 'A+' with negative outlook to 'A' with stable outlook. According to the Finance Ministry, this move was expected, as S&P's previous rating was two notches higher compared to other agencies. The ministry added that the main reasons primarily include negative external factors slowing down the economy, such as problems faced by Slovakia's largest trading partners in the EU, energy risks, the oil crisis, and global uncertainty. The rating agency was also concerned about the 13th pension payment. jrg