Cracks in Finland's 'Triple A' image

Cracks in Finland's 'Triple A' image
This picture taken on January 22, 2009 in Helsinki, Finland shows an advertising poster featuring a piggy bank with vampire fangs that urges Finns to continue spending despite fears of a recession and daily news of lay-offs and job cuts. Strict fiscal management has allowed Finland to remain the only country in the eurozone with a "triple A" rating and a stable outlook from all three major credit rating agencies Standard and Poor's, Moody's and Fitch but Finland's image as an island of fiscal virtue in an ocean of European profligacy has eroded to the point that many ask if it can keep its stellar credit rating.

HELSINKI - Finland's image as an island of fiscal virtue in an ocean of European profligacy has eroded to the point that many ask if it can keep its stellar credit rating.

Fitch confirmed Finland's top "AAA" rating on Thursday, but warned that it could be lowered in future, in case for example of a "failure to tackle the trend decline in potential growth".

The Nordic eurozone member has long prided itself on the extremely strict fiscal management that has allowed it to avoid ever breaking EU fiscal rules.

The budget deficit has consistently remained below three per cent of gross domestic product, while public debt has been held within 60 per cent, as required by the Maastricht Treaty.

Strict fiscal management has allowed Finland to remain the only country in the eurozone with a "triple A" rating and a stable outlook from all three major credit rating agencies Standard and Poor's, Moody's and Fitch.

Even Luxembourg and Germany, the eurozone's other two paragons of fiscal virtue, can no longer boast that.

Finland lost its top rating in the 1990s but regained it in 2002. Since then, the ratings agencies have regularly praised the country for its well-functioning political system, based on a tradition of political consensus and moderate spending.

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