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Russian Foreign Ministry considers rating cuts result of Western pressure

March 23, 2015, 14:01 UTC+3 MOSCOW

The head of Russian Foreign Ministry’s department on economic cooperation says rating agencies are not able to withstand pressure from customers

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© Artyom Geodakyan/TASS

MOSCOW, March 23. /TASS/. Lowering Russia’s credit ratings is connected with sanctions pressure on the country, head of Russian Foreign Ministry’s department on economic cooperation Yevgeny Stanislavov said on Monday.

"Rating agencies are not able to withstand pressure from customers, but since this problem exists at the level of commercial partners, one could not rule out that it [the problem] emerged as a result of pressure from authorities," Stanislavov said. "From this point of view, it is absolutely justified to think that lowering Russia’s rating goes in line with sanctions pressure from Western governments," he added.

The diplomat gave as an example "last year’s decision by Standard & Poor’s to change outlook for Ukraine’s foreign currency rating from negative to stable." "Then, it was connected with IMF [International Monetary Fund] loan allocated to Ukraine for macroeconomic stabilization," he said. "This decision was not hampered neither by the situation in the south-east of Ukraine nor by unfavorable macroeconomic indicators. On January 26, when the Russian government announced developing a large-scale anti-crisis plan worth $20 billion at that time, Standard & Poor’s made a decision to lower Russia’s rating with negative outlook," the diplomat noted.

"Credit ratings are becoming a criterion of countries’ financial stability and have a significant influence on investment climate," Stanislavov noted. "In fact, this not an abstract mathematical problem with numbers and letters any more, it is a mechanism which assesses the real worth of assets and possibilities of attracting finances on global markets," he stressed.

Stanislavov noted that this not only Russia’s problem, it is discussed in G20, Financial Stability Board and UN. "It is necessary to discuss this problem with more international participants," he stressed. "Rating agencies are criticized not only in Russia, but in other countries as well, including in the US in the aftermath of the mortgage crisis, as well as in Europe. This is a well-known fact, and we need to use international platforms, in particular in UN, where International Conference on Financing for Development is in force," he said.

The Russian Foreign Ministry’s official spokesman in early February said the ratings of Western agencies that are mostly politically motivated.

"It’s no secret that rating assessments by Western agencies in many cases are political," Alexander Lukashevich said, reminding that the inflated ratings of US companies Fannie Mae and Freddie Mac played a hand in the 2008 economic crisis.

"The use of targeted and deliberate downgrades of ratings of Russian companies and the sovereign rating of the country has become a part of the US and EU economic war against us," Lukashevich said.

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