Fri Dec 20, 2013 7:38AM GMT

Standard and Poor’s (S&P) rating agency has downgraded the European Union’s credit rating by one notch to AA+.

credit ratingThe US financial rating agency said on Friday that it lowered the credit-worthiness of the EU from AAA to AA+ due to the bloc’s recent poor economic performance.

“The downgrade… reflects our view of weaker creditworthiness among the 28 EU member states, including among net creditors to the EU’s budget,” the agency said in a statement on Friday.

“In our view, EU budgetary negotiations have become more contentious, signaling what we consider to be rising risks to the support of the EU from some member states,” it added.

The agency also said that the bloc’s financial “arrangements have deteriorated, and that cohesion among members has lessened.”

The agency has had a negative outlook on the EU since January 2012 and has since downgraded several member states including France, Italy, Spain and the Netherlands, the latest EU state to be demoted.

S&P downgraded the Netherlands late November, saying that the country’s growth prospects were “weaker than we had previously anticipated.”

Europe is struggling with an economic crisis that erupted in early 2008, leaving millions unemployed and in financial distress.

The worsening debt crisis has forced EU governments to adopt harsh austerity measures and tough economic reforms, which have triggered massive protests in many European countries.