Ireland's Strife 'Exaggerated' Says Ratings Agency

A major international ratings agency has said concerns over political and fiscal risks in Ireland are "exaggerated".

Spokesman for credit company Standard & Poor's, David Beers, said during a speech in New York that the Irish economy had "turned a corner".

In his unexpectedly positive assessment Mr Beers said Ireland was likely to recover faster than those of other weak euro zone countries such as Portugal, Spain and Greece as it has a more flexible private sector, and as long as foreign direct investment keeps flowing into the country.

"People may have an exaggerated concern about the political story in Ireland. People think that the Irish political establishment may be suffering from exhaustion, reform fatigue. We actually do not detect that," Mr Beers said.

He added: "Ireland's competitiveness is improving because the labor market is flexible -- they're cutting wages and salaries. So we think that among the peripheral countries it would be the first to begin to recover."

The Standard & Poor's credit rating agency has consistently given Ireland negative economic outlooks, leading Europe's top credit companies in downscaling Ireland's credit rating to AA- in late August.

Mr Beers made the comments during a major run of meetings with the International Monetary Fund and the World Bank. The meetings are also being attended by many of the world's financial leaders.

The credit analyst said that there could be more bad news in the banking sector, but downplayed market fears that the Government could be losing the willingness to proceed with economic reforms or to keep fiscal discipline.

(DW/GK)