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Credit rating agencies reaffirm Hong Kong's economic basis

Hong Kong is in a good position to benefit from the structural rebalancing in mainland China's economy.

Both S&P’s and Moody’s recently reaffirmed Hong Kong’s credit ratings, while revising Hong Kong’s outlook. S&P’s decision to maintain Hong Kong’s credit rating at AAA in the long term and A-1+ in the short term, as well as Moody’s decision to reaffirm the city’s Aa1 rating, recognizes Hong Kong’s sound economic fundamentals, sizeable fiscal reserves and prudent fiscal policies.

Hong Kong Financial Secretary John Tsang said, “Hong Kong is in a good position to benefit from the structural rebalancing in [mainland China’s] economy from investment to consumption, as the increase in demand in services will create new business opportunities for a service-oriented economy like Hong Kong.”

The Financial Secretary reiterated that the principle of “One Country, Two Systems” has worked well. “Both the Central People's Government and the Hong Kong Special Administrative Region Government remain firmly committed to upholding this principle,” he said.

In response to S&P’s revised outlook on Hong Kong, Secretary for Financial Services and the Treasury Professor K.C. Chan disagreed with the assessment and revision of Hong Kong's outlook. He argued that amid the uncertain global economic outlook, the Mainland will continue to be a key source of growth and stability for the global economy. He welcomed S&P’s recognition of Hong Kong’s Linked Exchange Rate System and the Hong Kong Monetary Authority’s prudent regulations that help maintain confidence in the banking sector.

 


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