Markets chief promotes idea of EU credit rating agency

Issued on: 30/04/2010 - 20:07Modified: 30/04/2010 - 20:13

Text by: FRANCE 24 (with wires)

2 min

The European Commissioner for Internal Market and Services, Michel Barnier, said Friday he is weighing the idea of an independent European credit rating agency as an alternative to leading US companies after their handling of the Greek debt crisis.

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Europe may need its own credit rating agency, said Michael Barnier, head of the European Commission’s Internal Market and Services, on Friday amid concerns over a credit rating downgrade by Standard and Poor’s that aggravated Greece’s debt woes.

“I was surprised by the brutal way they downgraded Greece’s rating. I won’t comment on the results, but I think that there should be more consideration when rating a state”, Barnier told FRANCE 24. He went on to say that he believed that agencies should contextualise the situation of a country before issuing a damaging downgrade.

In interviews with various French media, Barnier advocated for increased transparency among the three leading credit rating agencies, Standard & Poor’s, Moody’s and Fitch, and put forward the possibility of creating a European credit rating agency as an alternative to the US-dominated institutions.

In the French business daily Les Echos Barnier observed that the “landscape of credit rating agencies” is too concentrated given the importance of the decisions they make. “I’ve been thinking carefully about the idea, about the feasibility and the added value of creating a European agency”, Barnier said.

Barnier’s proposal is being echoed across Europe. The German vice-chancellor and minister of foreign affairs, Guido Westerwelle, also evoked the idea of creating an EU-based rating agency on Friday.

Michel Barnier