S&P downgrades 9 Eurozone countries including France, Italy

The downgrades—announced after US markets closed on Friday—are likely to be a dampener for financial markets as investors are likely to sell euro, Eurozone equities and sovereign bonds

New York: Rating agency Standard and Poor’s (S&P) has lowered the sovereign ratings of nine Eurozone countries, including France and Italy, a move that reignited concerns over the fiscal sustainability of the region, reports PTI.

S&P has lowered the sovereign ratings on nine Eurozone countries, of which the long-term ratings on Cyprus, Italy, Portugal, and Spain were lowered by two notches.

The sovereign ratings on Austria, France, Malta, Slovakia, and Slovenia, were lowered by one notch.

France’s sovereign rating has been downgraded to AA+ the level of US long-term debt, which S&P downgraded in August last year.

Germany was the only country that retained its coveted AAA tag—the highest investment grade ratings.

“Today’s rating actions are primarily driven by our assessment that the policy initiatives that have been taken by European policymakers in recent weeks may be insufficient to fully address ongoing systemic stresses in the Eurozone,” S&P said in a statement.

Sovereign rating is an indicator of country's credit worthiness.

Meanwhile, French finance minister Francois Baroin has reportedly told France-2 Television, that the downgrade of France’s AAA sovereign debt rating was not “a catastrophe.”

He reiterated that France still had a solid rating.

“The US, the world’s largest economy, was downgraded over the summer,” Mr Baroin said. “You have to be relative; you have keep your cool. It’s necessary not to frighten the French people about it.”

European economic affairs commissioner Olli Rehn also criticised S&P’s decision to downgrade nine Eurozone nations as ‘inconsistent’.

The downgrades—announced after US markets closed on Friday—are likely to be a dampener for financial markets as investors are likely to sell euro, Eurozone equities and sovereign bonds.

Meanwhile, earlier Friday, the euro had hit its lowest level in more than a year and stock markets in Europe and the US fell.

S&P said the ‘stresses’ in the Eurozone include: tightening credit conditions; an increase in risk premiums for a widening group of Eurozone issuers; a simultaneous attempt to deliver by governments and households; weakening economic growth prospects; and an open and prolonged dispute among European policymakers over the proper approach to address challenges.

The outlooks on all ratings but for two of the 16 Eurozone sovereigns are negative, indicating that there is at least a one-in-three chance that the rating will be lowered in 2012 or 2013, S&P added.

“The outcomes from the EU summit on 9th December 2011, and subsequent statements from policymakers, lead us to believe that the agreement reached has not produced a breakthrough of sufficient size and scope to fully address the Eurozone’s financial problems,” S&P said.

The EU summit mulled ways to bolster the sagging economic conditions in the euro area—a grouping of 17 countries that share the euro currency.

Meanwhile, S&P has affirmed the long-term ratings on Belgium, Estonia, Finland, Germany, Ireland, Luxembourg, and the Netherlands and the outlooks on the long-term ratings on Germany and Slovakia are stable.

In December last year S&P had warned that 15 European nations were at risk for a possible downgrade, citing increased systemic risk in the region.

Tightening credit conditions, disagreements among European policy makers, high levels of government and household indebtedness, were some of the reasons cited by S&P for keeping sovereign ratings on watch in December 2011.

Earlier in August 2011, S&P had downgraded the US government’s ‘AAA’ sovereign credit rating.

The downgrade, S&P said, reflected its opinion that the fiscal consolidation plan which Congress and the administration recently agreed to “falls short of what, in our view, would be necessary to stabilise the government’s medium-term debt dynamics.”


Serving the sick

Nana Palkar Smruti Samiti provides free accommodation and food to poor patients from out of Mumbai, Alekh Angre reports

Mumbai with its large hospitals, like Tata Memorial and KEM (King Edward Memorial) providing affordable treatment for critical diseases like cancer, attracts thousands of patients from all over the country. However, accommodation for the duration of hospitalisation for patients and the accompanying family members has been a major problem. It’s not unusual to see scores of people sleeping and cooking in the hospital premises or on pavements outside.

The situation was the same four decades ago. Nana Palkar Smruti Samiti (NPSS), founded in 1968, sought to bridge this gap. It provides free accommodation and food to the patients and their two attendees as well as transportation to hospitals.

NPSS was founded in the memory of late Nanasaheb Palkar, writer, orator and a well-known pracharak of the Rashtriya Swayamsevak Sangh (RSS), who was also a social crusader with keen interest in patient-care. NPSS started with one room in Parel (mid-town Mumbai). The services of the organisation gained popularity by word of mouth and more patients started seeking the help of NPSS. So, a plot of land was granted by the then municipal commissioner.

In 1997, NPSS got approval to build a 10-storey structure. The building is known as Rugna Seva Sadan. It can accommodate 76 patients and 152 accompanying attendees. At times, there are patients who can afford nominal fees. For them, NPSS charges Rs50 per day for monthly accommodation and Rs25 per meal. “With the help of donations from the public, we strive to give accommodation and other facilities to people who are poor and traumatised by the illness,” says AM Joshi, former secretary and trustee of NPSS.

Patients are given the facilities on obtaining a certificate either from a member of the RSS or the medical social worker of the hospital from where the patient has been referred. “Since patients come from different states, a valid medical/reference certificate is essential. It is a proof that the patient is a genuine one,” explains Mr Joshi. The organisation provides free ambulance service to the patients to take them to hospitals like Tata Memorial, KEM and Sion Hospital and charges Rs5 each to the patient’s attendees. Volunteers of NPSS distribute fruits to TB patients at Sewri Hospital every Thursday. “Since most patients are abandoned, giving them fruits and interacting with them cheers them up. We also distribute free breakfast to 200 children admitted at Wadia hospital everyday.”

NPSS also offers many other facilities. In 2004, NPSS started a dialysis centre with a nominal charge of Rs350. It has 12 haemodialysis machines treating 36 patients a day. Additionally, it also runs a low-cost pathological laboratory and provides free medicine and counselling to TB (tuberculosis) patients, among others. These services are free for poor patients; for others, a nominal fee is charged. NPSS has lithotripsy centres in Matunga (Mumbai) and Aurangabad (Maharashtra), providing treatment at Rs3,500. “The costs of such treatments are high, making it unaffordable for many. So we provide such services at nominal cost,” says Mr Joshi. NPSS gives financial assistance to poor patients undergoing treatment; for this, its monthly budget is Rs1.5 lakh. “The medical social worker of a particular hospital after verifying that the patient genuinely needs financial aid, issues a letter to him/her. Once we receive such a letter, we help the patient,” says Mr Joshi.

NPSS provides and arranges for blood donor registry and blood donation camps every year for major hospitals. It also has a branch in Borivali, where doctors provide medical care at a nominal rate. It hires out equipment like walkers, wheelchairs and water beds on low rent. You can donate to NPSS by way of money, in kind or volunteer your services. All donations are tax exempt under Section 80 (G) of the Income-Tax Act. 

158, Rugna Seva
Sadan Marg
Dr Babasaheb
Ambedkar Road
Parel, Mumbai 400 012
Tel: 2416 4890/
2417 2167
[email protected]




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