The Rise and Fall of Dagong Global Credit Rating Agency: A Geopolitical Challenge for the Rating Industry

摘要

Dagong Global Credit Rating Agency (Dagong) was originally branded as a Chinesenational representative credit rating agency. Its international expansion in the US and theEU, in order to challenge the biggest international credit rating agencies, was unsuccessfuland achieved little of significance. Dagong’s business suffered a complete halt becauseof a one-year suspension by the Chinese financial regulators. Its ratings heeded China’sgeopolitical interest and China’s strategic plans of economic development rather thansignalling the credit risks of debt instruments. Dagong’s ratings had a significant politicalbias towards countries which were China’s economic and political allies or suppliedraw materials to China. Dagong officially became a state-owned credit rating agencyfollowing a reconstruction by the Chinese state in 2019. This article concludes that thisnew ownership may exacerbate the geopolitical characteristics of Dagong and poses achallenge to the international financial market.