Ratings agency Fitch lowers China’s sovereign credit outlook to negative
Al Jazeera
Beijing says it is ‘disappointed’ with decision by US-based ratings agency.
Fitch Ratings has downgraded China’s sovereign credit outlook to negative, prompting pushback from Beijing.
The downgrade reflects “increasing risks to China’s public finance outlook” as the country attempts to move away from real estate-led growth, the New York-based ratings agency said on Wednesday.
Fitch, one of the “big three” ratings agencies along with Moody’s and Standard & Poor’s, said it expected the government deficit to rise to 7.1 percent of gross domestic product (GDP) in 2024, up from 5.8 percent last year.
Government debt was forecast to rise to 61.3 percent of GDP this year, up from 56.1 percent in 2023.
“Wide fiscal deficits and rising government debt in recent years have eroded fiscal buffers from a ratings perspective,” Fitch said.
