The international credit ratings agency Fitch on Oct. 6 maintained Korea's sovereign credit rating at "AA-" with a stable outlook. (Yonhap News)

By Kim Young Deok and Yoon Sojung

The international credit ratings agency Fitch on Oct. 6 said it maintained Korea's sovereign rating at "AA-" with a stable outlook.

"Korea's rating balances robust external finances, steady macroeconomic performance and sufficient fiscal headroom going into the coronavirus pandemic against geopolitical risks related to North Korea and medium-term structural challenges from ageing demographics and moderate productivity growth," it said in a news release. 

In comparison with other advanced economies and countries with a similar "AA" rating, Fitch also predicted a modest contraction of 1.1% this year for the Korean economy, reflecting the government's effective strategy to contain COVID-19.

"Robust external finances, underpinned by a large net external creditor position, sustained current account surpluses since 1998, and large foreign-exchange reserves, provide a buffer against global financial market volatility," the agency said.

Lee Ho-seung, senior presidential secretary for economic affairs, told a media briefing at Cheong Wa Dae on Oct. 7, “The U.K. and France are in the similar 'AA' group with Korea while China and Japan are in those one or two grades lower."

"With a record number of economies seeing lower sovereign ratings and outlooks due to the depression of the world economy, Fitch's reaffirmation of Korea's sovereign rating proved the international creditability of the Korean economy."

He added that Fitch "rediscovered" Korea by objectively comparing the nation's economic status with that of other countries.

Based on Fitch's sovereign ratings list of major economies released on Oct. 6 (Fitch)