BEIJING, Feb. 21 (Xinhua) -- Dagong Global Credit Rating Co., Ltd., China's domestic rating agency, decided on Tuesday to assign an AA- rating with a stable outlook to the Cayman Islands' local and foreign currency sovereign credit.
The rating reflects the Cayman Islands' stable political environment, high level of economic and financial development, small fiscal deficit, light debt burden and strong solvency, the rating agency said.
The country failed to gain a higher credit rating because it remained over-reliant on the finance and tourism industries for economic growth and it was vulnerable to natural disasters such as hurricanes.
Although the Cayman Islands posted mild growth last year after three years of recession, its growth momentum was not strong.
Dagong estimated that the country's economy will expand by 1.5 percent over the next two years in light of the lasting Eurozone debt crisis.
The country's government debt ratio stood at 25.5 percent at the end of December. Despite marking a sharp rise from 2007, analysts said the government debt will be on a downward trend in the mid-term.
Meanwhile, the country's large assets and strong financing capacity are conducive to buoying its solvency, the agency said.
Special Report: Global Financial Crisis
