Fitch Ratings upgraded Macau’s rating from “AA-” to “AA” for long-term foreign currency debt issues, just two levels below the top rating of “AAA”, with a stable outlook, according to a statement released on Tuesday.
The “AA” rating is based on the achievement and maintenance of a sound financial capacity to make financial commitments, which will not be easily affected by foreseeable events, and the risk of default is very low.
Fitch Ratings noted that despite the fact that Macau’s economy has undergone profound adjustments, the government has shown a high degree of discipline in the financial field and has strictly followed the principle of the balance of revenue and expenditure set out in the Basic Law, allowing it to establish a relevant basis to maintain financial stability in the medium term.
Macau’s solid financial capacity and its revenue and expenditure were important factors leading to raising its credit rating, according to the Macau Monetary Authority.
At the end of November 2017, the Macau financial reserve totalled 487.1 billion patacas (US$59.7 billion), with the basic reserve totalling 128.0 billion patacas and the extraordinary reserve 359.1 billion patacas.
The Macau Government will continue to follow the principle of keeping expenses within the limits of revenue as a prudent financial management principle and to improve the financial resources management system to ensure the sustainable development of the territory’s finances, the Macau Monetary Authority said. (macauhub)