“The Fitch rating agency has recently published a special report devoted to this decision. Analysts clearly indicate that SAFE means lower costs of financing expenses, and the proposed so-called SAFE 0% means risk and uncertainty,” wrote the Minister of Finance on X.
“Fitch sees blocking of the government's actions to improve the budget situation and points to uncertainty around the role of the NBP. Political veto, real losses,” he added.
The Fitch agency is one of the three most important rating agencies in the world dealing with creditworthiness assessment. At the end of February Fitch confirmed Poland's rating at “A-” and maintained its negative outlook.
In the latest report published on Tuesday, the agency commented on the veto of the SAFE Act.
“Increasing defense spending is seen as a priority by all political parties in a context of high security risks. However, the recent debate on costs, sources of financing and geopolitical implications in relations with the EU and the US illustrates the intensification of political polarization and the risk that prolonged political impasse will limit Poland's ability to implement policy” – says Fitch.
The agency emphasizes that the president's veto on the SAFE program followed repeated vetoes of other government proposals.
“The president also opposed tax increases and spending cuts, limiting the scope of possible fiscal consolidation before the next parliamentary elections in 2027.” – we read.
The agency notes that the debate around SAFE is “politically charged”. It also emphasizes the favorable conditions of the SAFE program and draws attention to the risks associated with the proposal of the president and president of the NBP, the so-called SAFE 0 percent
“We think so politically charged SAFE debate reflects key challenges underlying Poland's negative 'A-' rating outlook – says Fitch.
“Participating in the SAFE program could help ease the pressure of debt servicing by reducing marginal financing costs and extending maturities, as loan terms are favorable in terms of terms and costs compared to market financing, especially in the current volatile market conditions,” says the agency.
