American Agencies Are a Threat to European Stability
Published in Diario de Noticias
(Portugal) on 8 July 2011
by (link to original)
The president of the republic said today that the decisions of the rating agencies of North America are "a threat to the stability of the European economy" and considers the lowering of the Portuguese “rating” by Moody's to be "scandalous."
In a statement to journalists in Alentejo, Cavaco Silva affirmed that the problem is not just Portuguese and warned: "The project of European construction becomes more fragile if 27 heads of state and government let themselves be conditioned by the decisions of three U.S. agencies."
The case of Portugal’s rating being lowered by four notches this week was a "detonator which woke up the European leader to face what the North American agencies have been doing," the president said. “The 27 European heads of state have an obligation to give a response to defend this very important project, which is the project of one currency,” he affirmed.
The president of the republic took the opportunity during his visit to the Environmental Education Center of the League for the Protection of Nature (L.P.N.), in the municipality of Castro Verde, to voice strong criticisms of the lowering of the rating of the Portuguese public debt by Moody's.
"This case is a bit scandalous, we can say this, the Portuguese case. It was like a detonator which awoke the European leaders" to the actions of U.S. agencies, he said.
According to Silva, the lowering of the Portuguese rating "is totally unjustified" and "is proof of a lack of transparency and lack of objectivity of the U.S. rating agencies and a threat to the stability of the European economy, the Eurozone and the welfare of its citizens."
"It is incumbent on the European Union (EU) to give an appropriate response, because we are faced with a threat to fundamental questions of the EU," he emphasized.
In addition, "it should be a priority of the European agenda," Silva argued, "to liberate Europe from the influence of the North American rating agencies."
Emphasizing that he sees "no basis" in Moody's decision, because the current government "had just taken office and had begun to implement the financial assistance agreement" established by the "troika," the head of state welcomed the "positions of repudiation" which emerged "a little throughout all Europe."
"The decision of the European Central Bank," he said by way of an example, "was very important, in stating that the countries subject to the financial assistance programs should not be ruled by the assessments of the rating agencies, but rather by the analyses made” by the body itself, by the IMF and the European Commission.
Questioned if he saw something lacking in the reaction on the part of the executive lead by Passos Coelho, Silva argued that "Portugal should not react in the first place."
"It was important that the repudiation was expressed in the first place by other countries. Otherwise it would be said that it was just a Portuguese case. But this is not a Portuguese case; it is, clearly, a European case," he argued.
In a statement to journalists in Alentejo, Cavaco Silva affirmed that the problem is not just Portuguese and warned: "The project of European construction becomes more fragile if 27 heads of state and government let themselves be conditioned by the decisions of three U.S. agencies."
The case of Portugal’s rating being lowered by four notches this week was a "detonator which woke up the European leader to face what the North American agencies have been doing," the president said. “The 27 European heads of state have an obligation to give a response to defend this very important project, which is the project of one currency,” he affirmed.
The president of the republic took the opportunity during his visit to the Environmental Education Center of the League for the Protection of Nature (L.P.N.), in the municipality of Castro Verde, to voice strong criticisms of the lowering of the rating of the Portuguese public debt by Moody's.
"This case is a bit scandalous, we can say this, the Portuguese case. It was like a detonator which awoke the European leaders" to the actions of U.S. agencies, he said.
According to Silva, the lowering of the Portuguese rating "is totally unjustified" and "is proof of a lack of transparency and lack of objectivity of the U.S. rating agencies and a threat to the stability of the European economy, the Eurozone and the welfare of its citizens."
"It is incumbent on the European Union (EU) to give an appropriate response, because we are faced with a threat to fundamental questions of the EU," he emphasized.
In addition, "it should be a priority of the European agenda," Silva argued, "to liberate Europe from the influence of the North American rating agencies."
Emphasizing that he sees "no basis" in Moody's decision, because the current government "had just taken office and had begun to implement the financial assistance agreement" established by the "troika," the head of state welcomed the "positions of repudiation" which emerged "a little throughout all Europe."
"The decision of the European Central Bank," he said by way of an example, "was very important, in stating that the countries subject to the financial assistance programs should not be ruled by the assessments of the rating agencies, but rather by the analyses made” by the body itself, by the IMF and the European Commission.
Questioned if he saw something lacking in the reaction on the part of the executive lead by Passos Coelho, Silva argued that "Portugal should not react in the first place."
"It was important that the repudiation was expressed in the first place by other countries. Otherwise it would be said that it was just a Portuguese case. But this is not a Portuguese case; it is, clearly, a European case," he argued.
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