Jersey’s national credit rating downgraded

Global credit ratings agency Standard & Poor (S&P) has revised its ratings for Jersey, Guernsey and other small sovereign states. However the drop from AA+ to AA is still one of the highest and the Island’s financial position has not changed since the last review in November 2015.

The rating drop has resulted from S&P deciding that small countries like the Channel Islands should not receive the same ratings as larger countries, as they are more susceptible to global economic factors.

Treasury and Resources Minister Alan MacLean said while Jersey still has one of the highest possible ratings (third out of a possible 28) he is nonetheless, disappointed with the downgrade.

‘While we understand that credit rating agencies are liable to take a particularly risk-averse view, we are disappointed with this recalibration exercise. It is good that Jersey has retained one of the highest possible ratings but we do not accept the rationale behind the change,’ he said.

Standard and Poor have also changed Jersey’s – and the UK’s – economic outlook classification to ‘negative’.

Treasury says this is due to the uncertainty surrounding the UK’s future in Europe in the run up to the referendum regarding EU membership.

In its report, S&P wrote: ‘The rating on Jersey continues to reflect our view of its mature political and institutional setting, flexible policy environment, wealthy economy and a healthy financial position underpinned by low debt and a high net general government asset position.’

Senator MacLean says it is important for people to understand that the revised ratings do not reflect a decline in the economy.

‘Their opinion around the likelihood of Brexit, for example, is not within our control, and there are many speculative views on that issue. I have every confidence that our economy will continue to grow, regardless of the outcome of that referendum,’ he said.

– Advertisement –
– Advertisement –