Isle of Man demands withdrawal of S&P after ratings downgrade
The Manx government has asked S&P to stop its ratings after the agency warned of risks to the island’s financial services industry from international regulation
The Isle of Man government has told Standard & Poor’s to stop rating its debt after the agency downgraded the island’s credit rating.
S&P cut the Isle of Man’s credit rating from AA+ to AA citing concerns that the international crackdown on offshore tax havens might impact on the island’s financial services industry. The sector currently accounts for 35pc of the Crown dependency’s GDP.
In a note published on Friday, S&P said it expects financial services to “gradually decline” due to “competitive pressure and tighter regulation that will affect all global offshore financial hubs”. The sector’s “contribution to growth has reduced” already, S&P said.
The Isle of Man, Jersey and Guernsey have recently negotiated an automatic exchange of tax information with the UK government as part of a drive for transparency.
But S&P said the outlook for the Isle of Man’s credit rating was “stable” reflecting “strong finances”, as well as the growth of sectors such as gaming and IT.