HKSAR Government’s response to Moody’s announcement of change to Hong Kong’s credit outlook rating

On December 6, 2023, the rating agency Moody’s announced that it will change Hong Kong’s credit outlook from „stable“ to „negative“ while maintaining Hong Kong’s long-term issuer rating at „Aa3“, recognizing the city’s robust credit strengths, fiscal buffers, and significant reserves. In response to this announcement, the spokesman of the Hong Kong government publicly stated his disappointment about the negative outlook. In fact, he stated that Hong Kong’s credit outlook should not be negatively linked to the outlook of Mainland. The ties to Mainland are „a source of strength for Hong Kong’s long-term development“ and should not be viewed as constraints to the local ability to service debt. Also, the ties to Mainland help Hong Kong promote sustainable growth in Hong Kong’s economy and Mainland – on the other hand – has taken various steps to enhance its resilience and long-term economic outlook.
Furthermore, the spokesman criticized Moody‘ „unfounded comments on the high-degree of autonomy of the Hong Kong Special Administrative Region, our political and judicial institutions, the implementation of the National Security Law (NSL) and changes to the electoral system“. It was this Law, so the spokesman, that brought about an end to the turbulent situation in Hong Kong and that restored trust in Hong Kong’s financial market and the government’s ability to stay abreast of weathering conditions.
In the end, Hong Kong will hold on to its „one country, two systems” policy which in the long run will enrich the country and foster Hong Kong’s strengths „as an international financial and trade centre“.