Gov't Rejects Credit Rating

The Government today expressed disappointment about Fitch’s decision to downgrade Hong Kong’s credit rating from AA to AA-.

Fitch also changed the city’s outlook from negative to stable.

It said the decision to downgrade the city’s credit rating reflects a disproportionate emphasis on prevailing socio-political issues without giving due recognition to the strong fundamentals underpinning the local economy and financial market.

The Government pointed out that the COVID-19 pandemic has dealt an unprecedented and severe blow to the global economy and the impact on Hong Kong is no more significant than on other places, adding that it has quickly and effectively tackled the epidemic and its effect on the city’s economy.

It noted that with its strong fiscal reserves, massive relief measures of $287.5 billion have been rolled out to preserve the vitality of the economy and to help businesses and people endure the current hardship.

Hong Kong’s strong financial system with large buffers underpin the city’s resilience to severe and unexpected shocks, it said, adding the city’s financial markets and banking system are functioning normally.

The Government also said the view that Hong Kong’s rising economic and financial ties with the Mainland is credit negative is highly questionable.

The city will be in a better position to benefit from the Mainland’s strong economic growth and is poised to be a facilitator and a beneficiary of important national development strategies.

Since the return to the Motherland, the Hong Kong Special Administrative Region has been exercising “Hong Kong people administering Hong Kong” and a high degree of autonomy in strict accordance with the Basic Law.

The “one country, two systems” principle has been fully and successfully implemented, it added.

Despite the unprecedented challenges, Hong Kong’s institutional strengths and core competitiveness are unscathed, it said.

The Government will remain vigilant in assessing the economic impact of the internal and external environment and introduce timely measures to support Hong Kong’s economic development.