Gov. Mapp Says VI Government Has Cut Ties With Ratings Agencies
ST. THOMAS — Governor Kenneth Mapp surprisingly took a jab at the three top U.S. ratings agencies on talk radio on Tuesday, revealing to Virgin Islanders that his administration has ended its relationship with the firms — among them Standard and Poor’s, Fitch and Moody’s — while sending a clear message that his administration no longer wanted to hear from them.
“I’m not taking on the issues of the rating agencies, they will not pretty much have more to write about the territory. We’ve severed our ties with them; there’s no need,” Mr. Mapp said on WSTA 1340 AM. “We don’t have market access, so it makes very little sense for the rating agencies to come telling you every other month you can’t borrow no money.”
Mr. Mapp’s sidelining of the ratings agencies represents the first such move, at least in public, by his administration. Not too long ago, the governor pointed to Fitch’s decision to maintain a negative watch on the territory’s bonds in July, pointing out that the action was not a downgrade. In fact, the governor said Fitch’s decision to maintain the negative watch was a good sign. One month later, Fitch downgraded the territory’s bonds further into junk status and issued a negative outlook. Its downgrade was followed by that of S&P, which also placed a negative outlook on the bonds.
Mr. Mapp said the territory would no longer rely on the capital market to bridge its annual structural deficit, which averages over $100 million. Instead, austerity measures will have to be implemented, he said, if the territory is to survive.
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