List of Countries with Highest Credit Ratings

  • The highest credit rating is a AAA rating with ‘stable outlook’. A AAA credit rating implies there is no remote chance of default on government debt.
  • A negative AAA credit rating implies there is a chance of downgrading the debt to AA.
  • A credit rating of BBB- or higher, it is said to be ‘investment grade’. Anything lower than BBB- is said to be a speculative investment with high chance of default.

Countries with Highest Triple AAA Credit Rating

Austria

Public debt ratio was 70.4 percent of GDP. Helped by close ties to Germany, though vulnerable to problems in Eurozone economy

Australia

Public sector debt for 2010 – 22.4 percent of GDP. Has a ‘stable’ outlook at all main rating agencies.

Canada

Public debt at the end of 2010 was 37% GDP (though see Canada National debt for other figures. Despite being tied to fortunes of US economy, high natural resources help export revenue.

Denmark

Public sector debt in 2010 46.6 percent of GDP.

Finland

Public sector  debt  45.4% of GDP.

France

Public Sector Debt 68% of GDP. Growing budget deficits to 7.8% in 2010. High spending commitments and high unemployment. First signs markets may be worried France could be dragged into the Euro fiscal crisis.

Germany

Public debt – 78.8 percent of 2010 GDP. A public sector debt that still bears the imprint of reunification. Despite relatively high public sector debt, Germany is seen as the ‘rock of the Eurozone’. The question is to what extent will Germany:

  • be willing to bail out other Eurzone members?
  • To what extent can Germany bail out all the profligate southerners?

Netherlands

Public sector debt is now projected at 64.6 % of GDP.

Norway

2010 Public sector debt was 47.7%  GDP.

Singapore

Public sector debt 102.4% GDP (though this is artificially inflated). I Singapore has  not borrowed to finance any government deficits since the 1980s.

Sweden

Public debt in 2010 was 40.8 % of GDP

Switzerland

Public debt is still at 38.2 percent per revised 2010 data. The Swiss economy is immune from many problems facing other countries, it’s biggest challenge may be to prevent the Swiss Franc appreciating against other currencies, as investors look for a safe haven to pile into.

 United Kingdom

UK Public sector debt (excluding financial sector)  61% of GDP. However, one of highest budget deficits (over 11% of GDP). Spending cuts planning to bring down borrowing, but concerns over strength of economic recovery. Also, pension liabilities make future financial situation more difficult.

If the UK was in Euro without independent Central Bank, almost certainly wouldn’t have AAA rating.

Countries With AAA at some credit rating Agencies

US still has AAA credit rating with Fitch and Moody

Observation

It is interesting to note that the countries with AAA credit ratings also have amongst the highest levels of government spending and most extensive welfare state.

There is no obvious link between the level of national debt and the actual credit rating. Many other factors determine the risk of default.

Minor Countries

  • Guernsey
  • Hong Kong
  • Isle of Man
  • Liechtenstein
  • Luxembourg

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