Basescu goes after Standard & Poor's: President is "revolted" Romania is stuck in the "junk" category

President Traian Basescu said on Saturday, in Arad, that he is “revolted” that Standard & Poor’s is unwilling to upgrade Romania from the “junk” category, which defines it as a country unsuitable for investments. The chief-of-state believes the rating agency is “horribly unfair” towards his country, writes Mediafax.

“The are three rating agencies in the world and two of them, Moody’s and Fitch, have given Romania an investment grade a long time ago. Moody’s didn’t lower it even during the height of the crisis”, Traian Basescu said, stating that Standard & Poor’s even today, after Romania has achieved a 3.5 percent economic growth, “is able to maintain the country under the junk rating”.

“I am revolted by this rating agency’s behavior”, the president said. “Romanians deserve an explanation because they are the ones that have accepted all the sacrifices of a macro-economic readjustments, with salary cutbacks, raised VAT etc. A rating agency can not afford to play around with a country’s rating if that country has done the work it needed to do”, according to Basescu.

“Romania had the courage to take steps immediately so that it can resume grow immediately. That is why Standard and Poor’s seems to me is acting very unfairly towards Romania by refusing to rate it as a country safe for investments”, the president concluded.

Romania has struggled to shed its junk rating for five years, embarking on one of the European Union’s toughest austerity programs in 2010 by cutting state wages 25 percent and raising value-added tax by 5 percentage points. The government secured a third international bailout loan this year and has narrowed the budget gap to an estimated 2.5 percent of gross domestic product this year, from 7.2 percent in 2009.

“We could raise the ratings if the planned program of budgetary consolidation, public finance reform, and public enterprise restructuring is implemented in line with our expectations, while keeping external imbalances and financial sector stability in check,” S&P analysts Marko Mrsnik and Frank Gill, said in the statement in November 2013.