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WHY CHINA’S SIZE DOES NOT GUARANTEE AAA RATING, SAYS DATAPRO

ABUJA — Credit rating agency DataPro says a country’s economic size alone does not guarantee the highest sovereign credit rating.

 

The agency was reacting to China’s A+ rating, despite being the world’s second-largest economy by nominal GDP and a major player in global trade.

 

DataPro said sovereign ratings measure credit strength and resilience, not just the size of an economy.

 

‎The agency said China has clear strengths. These include a large and diversified economy, strong foreign exchange reserves, deep domestic savings and strong policy capacity.

 

‎But DataPro said those strengths are balanced against key risks.

 

‎It listed rising government debt, especially at local government level, revenue challenges, and off-budget liabilities as pressure points.

 

‎The agency also cited slower growth, the prolonged property sector adjustment, weaker domestic demand, demographic changes and productivity challenges.

 

‎DataPro explained that a triple-A rating requires more than economic scale. It said debt sustainability, fiscal strength, financial stability and effective institutions all matter.

 

The agency said China’s A+ rating shows that being big does not automatically mean being safer.

 

It added that reaching AAA depends on how well a country sustains its economic strengths while managing fiscal and structural challenges over time.