Dagong puts sovereign credit rating of Kuwait at AA

BEIJING - Dagong Global Credit Rating Co Ltd, China's leading credit rating agency, on Wednesday assigned a local and foreign currency sovereign credit rating of AA to the state of Kuwait, each with a stable outlook.

The rating reflects the country's robust fiscal and foreign exchange strength, as well as its complex geopolitical environment and economic vulnerability, Dagong said.

Taking high international energy prices and steady demand from the country's main trading partners into consideration, Dagong predicted that Kuwait's economic growth will hit 6.6 percent and 6.3 percent, respectively, in 2012 and 2013.

The limited effects of economic diversification will not reduce the country's vulnerability to sudden deterioration due to tensions in Iran, Dagong said.

The rating agency said Kuwait's ample fiscal power, including a budget surplus that accounts for 17 percent of its GDP, will be further strengthened by high energy prices, while a persistent current account surplus will guarantee the repayment of external debt.