Arab Today, arab today sp puts negative outlook on britains top aaa rating
Last Updated : GMT 20:10:12
Arab Today, arab today
Arab Today, arab today

Due to government's decision to hold EU referendum

S&P puts negative outlook on Britain's top AAA rating

Arab Today, arab today

Arab Today, arab today S&P puts negative outlook on Britain's top AAA rating

Standard & Poor's switched to negative the outlook on Britain's top AAA credit rating
London - Arab Today

Standard & Poor's said Friday it switched to negative the outlook on Britain's top AAA credit rating due to the government's decision to hold a referendum on whether to stay in the European Union.

"We believe that the UK government's decision to hold a referendum on EU membership by 2017 indicates that economic policymaking could be at risk of being more exposed to party politics than we had previously anticipated," the credit ratings agency said in a statement.

It recalled it had lowered the US's sovereign rating in 2011, when sharp political disagreements between Democrats and Republicans nearly pushed the country into default.

Legislation paving the way for Britain's referendum on leaving the EU crossed its first hurdle in parliament earlier this week, but Prime Minister David Cameron's Conservative party is deeply divided on the issue and holds only a narrow majority in parliament.

The referendum was a campaign promise in last month's election. The prime minister backs Britain's continuing membership in the EU, but dozens of MPs look set to support leaving.

Comments by Cameron this week triggered a row about whether ministers in his government would have to resign if they did not campaign for Britain to remain in Europe.

"A possible UK departure from the EU also raises questions about the financing of the economy's large twin deficits and high short-term external debt," said Standard and Poor's.

"We are therefore revising the outlook to negative from stable and affirming the 'AAA/A-1+' ratings on the UK," it added.

Despite austerity measures that Cameron introduced during his first term in office at the head of a Conservative-Liberal Democrat coalition government, Britain has yet to bring its budget back into balance and begin to cut its debt.

The deficit remains stubbornly high, at 5.2 percent of GDP in the 2014-2015 fiscal year, well above the EU limit of three percent and debt stands at almost 90 percent of gross domestic product (GDP), according to the Maastricht criteria, comparable with other EU countries.

Standard and Poor's put it at 83 percent of GDP this year, which it noted is slightly higher than that of the US at 80 percent and is the most elevated among all AAA rated sovereigns.

- Risks to economic prospects -

The ratings agency said the Conservative government might also have a difficult time trying to negotiate a better deal with the EU while also working on a constitutional settlement to devolve wide-ranging powers to Scotland.

"We find these objectives ambitious and (they) may well take precedence over other policy imperatives, such as how to address the supply bottlenecks in UK infrastructure and in the housing market," it said.

Standard and Poor's also said it believes "there are important risks to the UK's longer-term economic prospects should it leave the EU."

It noted that Britain's investment to GDP ratio is the lowest among AAA-rated countries, which increases the importance of the fact it has been attracting relatively high rates of foreign direct investments.

Most of these go into the financial services sector, which could take a knock if Britain leaves the EU.

"Whereas we believe that London will remain an important European financial centre even in the case of an EU exit, investment decisions by financial firms in the future in favour of other destinations could depress growth and fiscal performance," Standard and Poor's warned.
Source: AFP

Name *

E-mail *

Comment Title*

Comment *

: Characters Left

Mandatory *

Terms of use

Publishing Terms: Not to offend the author, or to persons or sanctities or attacking religions or divine self. And stay away from sectarian and racial incitement and insults.

I agree with the Terms of Use

Security Code*

Arab Today, arab today sp puts negative outlook on britains top aaa rating Arab Today, arab today sp puts negative outlook on britains top aaa rating

 



Arab Today, arab today
Arab Today, arab today Saudis await visitors but will they come?

GMT 11:54 2017 Thursday ,23 February

Saudis await visitors but will they come?
Arab Today, arab today Sarah Belamesh designs antiques of "ceramic"

GMT 19:45 2017 Monday ,20 February

Sarah Belamesh designs antiques of "ceramic"
Arab Today, arab today Blind sheikh buried in Egypt

GMT 06:32 2017 Thursday ,23 February

Blind sheikh buried in Egypt
Arab Today, arab today Media host Mona Iraqi stresses her show's success

GMT 15:32 2017 Wednesday ,22 February

Media host Mona Iraqi stresses her show's success

GMT 10:01 2017 Tuesday ,21 February

Egypt pound rebounds from flotation slide

GMT 09:57 2017 Tuesday ,21 February

Greece agrees to bailout reforms compromise

GMT 09:55 2017 Monday ,20 February

Thailand 2016 growth up but below junta target

GMT 09:29 2017 Monday ,20 February

Kraft Heinz withdraws bid for Unilever

GMT 09:22 2017 Monday ,20 February

China's huge debt poses big headache for central bank

GMT 18:23 2017 Sunday ,19 February

Darwesh vows to provide job opportunities for youth

GMT 12:10 2017 Sunday ,19 February

Welcomes the F&B solution of the future
View News in Arabic - Business: أخبار الأعمال
Arab Today, arab today
Arab Today, arab today
Arab Today, arab today To hold social dialogue over secondary school

GMT 07:43 2017 Wednesday ,22 February

To hold social dialogue over secondary school
Arab Today, arab today UK appoints 1st Scotland Yard chief in 188 years

GMT 05:14 2017 Thursday ,23 February

UK appoints 1st Scotland Yard chief in 188 years
Arab Today, arab today Ex-yoga missionary unleashes rage

GMT 12:16 2017 Thursday ,23 February

Ex-yoga missionary unleashes rage
Arab Today, arab today Pluto's unruly moons

GMT 06:31 2015 Thursday ,04 June

Pluto's unruly moons
Arab Today, arab today Tesla back into red but revenue grows

GMT 07:27 2017 Thursday ,23 February

Tesla back into red but revenue grows
Arab Today, arab today Nissan enhances sales in most markets

GMT 14:08 2017 Monday ,20 February

Nissan enhances sales in most markets
Arab Today, arab today Salma Rashid happy for 'A Whisper of Love'

GMT 05:19 2017 Tuesday ,21 February

Salma Rashid happy for 'A Whisper of Love'
Arab Today, arab today Milan laughs while Rome cries

GMT 10:28 2017 Wednesday ,22 February

Milan laughs while Rome cries

GMT 06:41 2017 Monday ,20 February

Janat pleased for issuing 'Good Morning'

GMT 12:35 2017 Tuesday ,21 February

63-Year-Old Woman Delivers Baby

GMT 14:29 2017 Monday ,20 February

Prepares to present her new collection

GMT 15:53 2017 Tuesday ,21 February

Small ponds have outsized impact

GMT 23:29 2017 Thursday ,16 February

Home built on sand castles-style costs $8m

GMT 07:51 2017 Wednesday ,22 February

Mom's immune system accepts babies

GMT 17:46 2017 Saturday ,18 February

Tourist guide reveals methods of tourist attractions

GMT 13:12 2015 Saturday ,09 May

Sheikh Sultan opens Sharjah Centre

GMT 19:10 2017 Friday ,17 February

Hats, scarves add beauty to women
Arab Today, arab today
Arab Today, arab today
 
 Arab Today Facebook,arab today facebook  Arab Today Twitter,arab today twitter Arab Today Rss,arab today rss  Arab Today Youtube,arab today youtube  Arab Today Youtube,arab today youtube
arabstoday arabstoday arabstoday arabstoday
arabstoday arabstoday arabstoday
arabstoday
بناية النخيل - رأس النبع _ خلف السفارة الفرنسية _بيروت - لبنان
arabstoday, Arabstoday, Arabstoday