Ineffective Reforms: S&P downgrades Venezuela credit rating

They cited ‘growing radicalization of economic policy’ as the reason.

WASHINGTON: Standard & Poor’s (S&P) cut Venezuela’s credit rating by one step and put the country on watch for another downgrade, citing the ‘growing radicalization of economic policy’ as the reason.”We expect the results of the December municipal elections to reinforce the recent trend toward more government intervention in the economy, creating greater uncertainty,” stated S&P. The agency said it foresees the continuation of ‘erratic’ economic policies by the government of Nicolas Maduro. In November, the National Assembly granted Maduro power to rule by decree for one year to fight corruption and respond to what he has called an ‘economic war’. He quickly rolled out a series of measures to force price cuts, notably on household appliances and cars, and threatened speculators with prison. But S&P pointed to a sharp rundown in the country’s international reserves over the past two months as the government tries to get inflation under control.

Published in The Express Tribune, December 15^th, 2013.

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