Democracy battle scares rating firms

PUBLISHED : Thursday, 06 May, 2004, 12:00am
UPDATED : Thursday, 06 May, 2004, 12:00am

The struggle over democracy is sharpening concerns about the government's ability to reduce the budget deficit, credit rating agencies said yesterday.

Standard & Poor's and Moody's Investors Service said they were worried that pro-democracy parties might capitalise on growing public discontent to hinder the government as it tried to bring in unpopular deficit-fighting measures such as a sales tax.

The statements mark a shift from last year, when the agencies focused on government finances in light of the sluggish economy.

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