China Finance Ministry Calls S&P Debt Downgrade Mistake

The Chinese Finance Ministry said that a downgrade of China’s sovereign credit rating by S&P was incomprehensible.

BEIJING (Sputnik) — A downgrade of China’s sovereign credit rating by the US financial services agency, Standard & Poor's (S&P), was incomprehensible and erroneous, the Chinese Finance Ministry said Friday.

The credit ratings agency cut the long-term rating to 'A+' from 'AA-' with a stable outlook. The short-term rating was lowered to 'A-1' from 'A-1+'.

"The S&P ratings agency’s decision to lower the Chinese sovereign credit rating was a mistake," the statement published on the ministry’s website read.

It said the national government had succeeded in recent years in shoring up economic growth by conducting structural reforms. "In this regard, the decision by S&P to cut China’s credit rating is hard to understand," the ministry concluded.

In May, Moody's Investors Service on also downgraded China's credit rating for the first time in nearly 30 years, the service warned that the only way for China to achieve high growth is using government-led stimulus. The Chinese Finance Ministry responded that the downgrade was based on an "inappropriate method".