Without the EU membership, V4 countries sovereign ratings would risk a drastic decline, Fitch ratings agency said in its report. “A deterioration in the relationship between the V4 and the EU could lead to negative pressures on the ratings in the medium to long term, depending primarily on its impact on economic prospects, institutional quality and the economic policy framework,” the report said.
“Benefits have been clearest through economic development and the quality of institutions. Monitoring of economic and fiscal policy by the EU in the context of the European Semester has bolstered macroeconomic stability and structural reforms. Hungary, since 2010, and Poland, since 2015, have adopted more confrontational attitudes to the EU. While relations with Czechia and Slovakia have been smoother, during the migrant crisis all V4 countries coalesced in a common rejection of EU policy,” Fitch said, adding that if the relations between V4 and EU would deteriorate, it could affect, economic situation in these nations. “Fitch believes the bulk of institutional and economic policy gains from EU membership are entrenched. However, further deterioration in relations with any of the V4 countries could alter economic and financial ties with the EU. This would be compounded by a potential move to a “multi-speed” EU, as suggested by the main EU leaders in early 2017, which could sideline some V4 countries. Such a scenario could have negative rating implications depending primarily on its impact on economic prospects, institutional quality and the economic policy framework.”