Belarus is planning to create a number of national rating agencies, Chairwoman of the Board of the National Bank of the Republic of Belarus (NBRB) Nadezhda Yermakova said during a live phone-in Q&A and online press conference at BelTA.
Belarus is developing a legal framework governing the national rating agencies. “We have plans to set up a number of national rating agencies. We believe that this approach will be efficient and will promote healthy competition in the market of rating services,” Nadezhda Yermakova noted.
The National Bank jointly with the ministries and organizations concerned has prepared a draft concept on the development of the system of assigning and using ratings on the national scale. At the moment the document is going though the stage of harmonization. It will be submitted to the President for approval by late 2014. The document will outline the areas of work for the legislators. Until the law on ratings and rating activities in the Republic of Belarus comes into force, the Council of Ministers and the National Bank will decide on the temporary status of the national rating agencies and recognize the ratings assigned by them, reads the draft concept.
The head of the National Bank believes that the decision to create the system of national rating agencies is economically sound taking into account the present-day situation. Despite the fact that there are around 100 rating agencies in the world, only three agencies hold over 90% of the global market: Standard & Poor's, Moody's Investors Service and Fitch. High-ranking officials and businessmen from different countries, such as Germany, Italy, France, China, and Russia, have repeatedly emphasized the need to impose constraints on this oligopoly, as the work of these rating agencies causes economic problems not only to some particular states and their economic entities, but also affects the global financial system. “Rating agencies are powerful tools to influence the financial market. Any baseless increase or decrease in the rating destabilizes the stock and exchange markets. Besides, the ratings by the leading world agencies are obviously getting politically motivated,” Nadezhda Yermakova emphasized.
Many countries started creating independent rating agencies after 2008. Some member countries of the future Eurasian Economic Union, such as Russia and Kazakhstan, also have their own rating agencies. “National rating agencies create ratings for the domestic financial market, for the domestic investors. These ratings together with those assigned by international agencies are expected to ensure equal access to the information about the investment risks and to promote the development of the financial market of the country. The more independent ratings we have, the more objective the information will be,” the head of the National Bank explained.
Written by belta.by
