Downgrade from Fitch
Finance Minister Giorgos Papaconstantinou is seen at a Eurogroup meeting in Brussels earlier this week. Late yesterday, the ministry said a decision by Fitch to cuts its rating for Greece failed to take into account additional commitments by Athens to meet budgetary goals for 2011 and speed up its privatization program. Fitch pushed Greece’s credit rating deeper into junk territory yesterday, warning of even further downgrades if the European Union and the International Monetary Fund do not come up with a credible plan to resolve the country’s debt crisis. One year into its EU-IMF bailout, Greece is struggling with weak revenues and a deep recession, fueling speculation it will have to restructure its debt to pull itself out of the fiscal mess that triggered a eurozone crisis. ‘The rating downgrade reflects the scale of the challenge facing Greece in implementing a radical fiscal and structural reform program necessary to secure solvency of the state and the foundations for sustained economic recovery,’ Fitch said in a statement. The three-notch cut to B+ with a negative outlook takes Fitch’s rating into ‘highly speculative’ territory, broadly in line with Standard & Poor’s B rating and Moody’s B1 grade.