Economists fear impact of austerity talks collapse

Economists say the collapse of talks aimed at getting the Dutch economy back on track will impact on the financial markets and could lead to the Netherlands losing its Triple A status, news agency ANP reports.

‘The markets will be very nervous about this. The interest on government loans will increase and if it looks as if the rise is permanent, then the rating agencies will downgrade,’ professor Sylvester Eijffinger told ANP. ‘This will cost the Netherlands its Triple A status. We will be following France and Austria.’
Economics professor Sweder van Wijnbergen said action needs to be taken to ensure a clear vision of the government’s finances as soon as possible.
‘The government has been talking for seven weeks and that is not conducive to a good compromise. We can be glad this lot has gone. Now the different political parties can give voters two or three clear positions.’

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