Valencia | Moody´s

The Valencia government had its credit rating dropped from BA1 to BA3 by Moody´s and the Valencia government has blamed the problems that it is having on this drop in credit ratings.

It was dropped because Moody´s saw growing liquidity problems and doubts over budgetary stability.The agency voiced doubts over Valencia´s capacity to reach its budget deficit reduction targets for the year.

Valencia had been unable to obtain the 1500 million euros in credit it required in December to pay its bills.Consequently the Valencia regional government has been forced to announce drastic cuts and tax rises in order to save one billion euros a year.

The government has been unable to do such basic things as pay chemists for the prescription medicines that they buy and schools are having problems in resourcing themselves with very basic needs.This week it was revealed that auxilliary teachers in primary schools had not been paid and money for the running costs of these schools was outstanding.A bill of 35 million.A meeting is to take place with primary school headteachers and the regional government education teams to attempt to resolve the problem.

A spokesperson for the Treasury Department has been honest enough to state that their traditional finance markets have closed down and that the smaller ones are saturated.There is a serious problem in securing finance in the Valencia region.