Warsaw Forum : : Standard & Poor's (S&P) shocks Poland

Originally aired on Radio Poland, 1/23.

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Last week Standard & Poor's shocked Poland with a credit rating downgrade to BBB+ from A- with a negative outlook and warned that the rating could fall further within the next two years.

The rating came as suprise to most. S&P attributes the downgrade to weakening the independence of key institutions such as the constitutional court and public broadcasting.

"The change in the rating outlook to negative reflects our view that there is potential for further erosion of the independence, credibility, and effectiveness of key institutions, especially the National Bank of Poland," stated S&P.

As the Polish Finance Minstry noted "this decision is contradictory to assessments presented by other rating agencies". In addition, critics claim there is no economic base for the downgrade.

Kamila Kudelska spoke with Tony Housh, a board member of the American Chamber of Commerce in Poland, about the possible consequence the S&P downgrade may have on international investors.

Also, the World Bank recently released the "Global Economic Prospects" report. Franziska Ohnsorg of the World Bank addresses the European markets concern on possible spillovers from a slowdown in the top four major emerging markets: Brazil, Russia, China and South African (BRICS).