MADRID, May 5 (Xinhua) - Risk assessment agency Stand and Poor's has lowered its rating for nine of Spain's autonomous communities.
Catalonia saw its rating fall four levels from A to BBB-, while the Balearic islands fell from A-to BBB- and Aragon and Andalusia saw the rating of their respective debts reduced from A to BBB.
Madrid, the Canary Islands and Galicia all saw two levels taken off their ratings which now stand at BBB+, while a similar reduction has taken the debt of the Basque Country and Navarra from AA- to A. These two regions have a higher rating as S&P considers they retain 'strong credit profiles' given their fiscal autonomy from the rest of Spain.
Coincidentally they are the two areas with the lowest levels of unemployment in Spain, well below the national average of 24 percent
S&P questions the ability of central government to provide aid to the regions given the effects of the recession, which will see Spain's economy shrink by around 1.8 percent this year and questions over whether or not slight growth will return to Spain in 2012.
For this reason S&P says some of the regions may not meet their budget targets, given a fall income and an inability to control expenses.
S&P lowers rating of Spain's Valencian autonomous community
MADRID, Feb. 28 (Xinhua) -- The international ratings agency Standard and Poor's on Tuesday decided to lower its rating of the Autonomous Community of Valencia in Spain.
The east coast region, which is governed by the Popular Party (PP), saw its debt rating lowered from BBB- down to BB, which means it is quite close to being worthless to potential investors, according to S&P.？