The international rating agency Fitch has affirmed China’s long-term foreign and local currency issuer default ratings (IDRs) at ‘A +’.
The outlook on the ratings is “stable”, the agency said in a press release. Short-term foreign and local currency IDRs were affirmed at “F1 +”.
Among the positive rating factors, Fitch experts note the strong external financial position of China, as well as strong macroeconomic indicators and the scale of the PRC’s economy, which is the second largest in the world.
The country’s ratings are negatively influenced by risks to budgetary and financial stability associated with a high level of debt in the private sector, as well as by the fact that GDP per capita in the country and corporate governance ratings are significantly lower than those of other countries in the “A” rating category. …
“The Chinese economy is in a mature phase of recovery from the crisis caused by the COVID-19 pandemic, thanks to the successful containment of the spread of the coronavirus.
Real GDP in the PRC in the first quarter of 2021 increased by 18.3% on an annualised basis, after rising by 6.5% in the fourth quarter.
Business activity indicators after the first quarter are mixed, but generally indicate some weakening of domestic demand, which, however, is balanced by still strong export demand and industrial production, “- said in a press release.
According to Fitch’s forecast, China’s GDP will increase by 8.4% in 2021 and 5.5% in 2022.