Treasury Minister Eddie Teare insists that it is just a coincidence that ratings agency Standard and Poor’s has downgraded the Isle of Man – just days after he announced he was not renewing its contract.
S&P cut the island’s credit rating from AA+ to AA on Friday, citing our vulnerability to growing regulatory pressure. It said in a statement: ‘The downgrade reflects our expectation the contribution of the financial sector to economic growth and exports will gradually decline, due to competitive pressures and tighter regulations that will affect global off-shore financial hubs.’
Just three days earlier, on Budget Day, Mr Teare announced he was not renewing the contract with S&P and would continue to use only rival agency Moody’s, saying we should not be paying twice for the same service. He told the Examiner: ‘When I prepared my Budget speech I had no idea they were going to downgrade us.’
The island lost its tripled A rating with Moody’s in December when it downgraded us to Aa1. We lost our AAA credit rating with S&Ps in 2011.