The Research On The International Sovereign Rating Methodology And The Application In China

Integration of the global economic and politic is accelerated. In the field of international economic, the everyday amount of bilateral trade, financial transaction, and multinational investments are trillion. International finance trade is even 24 - hour. All this ask for the management of sovereign risk.As the reform further develops,our trade volume leaps into the front ranks of the world,our country becomes the developing country of attracting the maximum foreign investment. With the rapid development of our economic and the accumulation of capital, domestic capital is looking for oversea opportunity. The multinational operation of China bank and enterprise becomes a trend. Whatever"bringing in"and"going out", they all demand our own sovereign risk monitoring and rating system.With a consideration of economic risk, this paper has a thorough overview of the methodology and model of sovereign rating. The first, we analyze all the thesis about the sovereign rating in the international academia, review the major rating agencies and rating work, then make a detail introduction about the major agency's rating methodology. The second, we give emphasis on the explainable indicators and theirs economic implication. The third, at the base of the analysis of the main rating models, we use Black-Scholes model to positively analyze the sustainability of Chinese foreign debt. At the last, we expound the economic effect after rating is released, and the urgency of building our own rating system.This paper's main research output are as followed:1,At the base of a thorough overview of the relative thesis, this paper gives a detailed survey about the sovereign rating definition, rating methodology , rating models. This is an obvious differentia with other thesis. The other thesis are only theory meaning and are scattered,partial, not developed into the theoretical model and model application.2,We put the corporate price theory of the Black-Scholes model into the sovereign risk assessment. Through the calculation of china economic capital value and foreign debt value, we make a positive analyze of the sustainability of Chinese foreign debt. We find out that with respect to the capacity of earning foreign exchange through exports and foreign currency reserve, foreign debtors have no investment risk in China.3,The world economic relationship is more and more closer ,the sovereign risk cannot be reflected only from GDP. Through the Black-Scholes model, we consider that the capacity of earning foreign exchange through exports should become an important indicator4,International rating agencies give China a low rating relative to china very low sovereign risk. It will increase the cost of china going into the international capital market, block foreign capital from coming into china. We need to establish our own rating system to breakup of rating monopoly.At the end ,we hope the paper can be used for reference in these fields: our country is integrated into the international market, the financial factor is opened wider to the outside world, the commercial banks participate in the international competition.