Why credit rating agencies interested in the Polish Constitutional Court? We have to explain this puzzle – Gazeta.pl

Moody’s in its assessment clearly explains what many Poles were not able to understand in January when we lowered the rating of S & amp; P. Why are they at all interested in Polish politics? What do they care about the Constitutional Court, as the IMF predicts that in 2017 we will be the best in Europe, GDP us to grow by 3 percent, and the unemployment rate is the lowest in eight years?

S & amp; P wrote in just that the downgrades, because the independence and effectiveness of institutions such as CT and public media have been weakened. Considering the fact that it is a rating of financial credibility, not political understand that it was still possible to ask the question “so what?”

S & amp; P admittedly pointed out that there potential risk of weakening the independence of the Polish National Bank, so already the key institution for the financial credibility of the country, but he mentioned that explaining the decrease in rating outlook to negative and not simply cut the rating. The case was so mildly quite murky.

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Moody’s puts it on a plate, without misunderstandings and writes: Although the implications of changes to the Constitutional Court for an independent judiciary and thereby the institutional state are at this point unclear, this crisis has the potential to disrupt the conviction among investors about the rule of law and, as a therefore their willingness to invest

Moody’s Investors Service

This “rule of law” is here very seriously. This is just the opinion of one of the rating agencies, which themselves do not enjoy a few years too good opinion, but nevertheless it shows how incredibly serious is this dispute which here goes. How much it is not a fighter from PiS vs. PO or PiS today already more vs. rest of the world. This shows how badly we can tarnish the image of the world.

Moody’s, however, is not about our image, but about the possible consequences. Enumerating factors that can make that next time (ie September) rating will be reduced to us we are mentioned among other things that the dispute over TK may cause such a reduction under one condition. This condition is the outflow of capital from Polish. If the conflict will continue, and as a result investors recognize that Poland comes from a family of countries equipped with the rule of law and withdraw from here, then the rating will go dół.To is the reason for the credit rating agencies that are closely watching the constitutional crisis in Poland.

I pal deuce is a rating, because the cause itself is a hundred times more important. The ratings are not addressed to governments, political parties and electorates of these parties. They are for investors who are considering whether to buy a bond Polish, Romanian, or perhaps Malaysia. Global investors before they decide to invest somewhere usually estimate the risk of such an investment. The ratings help them in this. Whether or not in a given country are the rule of law or not, it has an important impact on the estimate. Just in countries where the true rule of law is not (Russia, Belarus, Venezuela, etc.), There is a much greater risk that the invested money anymore to see. Such things happen in the world.

Of course, such things should never happen in Poland. Probably the vast majority of us are still convinced that this will never happen with us. But Moody’s assessment clearly shows that in the world there are already individuals and institutions who believe that it is potentially possible. That it is no longer excluded.

I think it’s damn depressing.