China’s bosses sometimes find it difficult to understand the world; especially as seen through their own lenses, which are admittedly very thick. What can you make out of the following news report – “The western rating agencies are politicised and highly ideological and they do not adhere to objective standards,” Guan Jianzhong, chairman of Dagong Global Credit Rating, told the Financial Times in an interview. “China is the biggest creditor nation in the world and with the rise and national rejuvenation of China we should have our say in how the credit risks of states are judged.”
China likes to develop everything by itself. It doesn’t like Google; it has Baidu instead. Doesn’t like Facebook, YouTube, Blogger, …….., I can go on and on. Every one of them has a local equivalent. It’s not just in IT. Take Credit rating. It wants its own credit rating agency. Enter Dagong Global Credit Rating. It has about a quarter of China’s own fledgling credit rating market, and of course zilch of the global market. It started life with a “technology agreement” with Moody’s back in the mid 90s and having learnt the ropes, kicked them out – that’s par for the course for business here.
Back to the delicious irony of Mr Guan’s comments. Western credit rating agencies are politicised and in the same sentence he argues for China to have a say in how credit risks of states are judged !! To an outsider, it would appear that you could accuse Moody’s , S&P and Fitch of lots of faults, but being “politicised” is the last thing that comes to my mind. But from behind the myopic lenses from inside Beijing, it is understandable that it looks that way, because everything else here is that way.
He then goes on to criticise the practice of “rating shopping” wherein companies shop among the Big 3 to see who would give the best rating and give the business to them. Yes, there was much of that in the boom time, but Mr Guan, this is called competition. It is anyday better to have rating shopping than to have a single agency that would take its orders from the government.
And then, as is the wont here, Dagong published its own ratings for soverign countries. No prizes for guessing which country comes above the United States, Britain, France, Japan …… Another delicious comment from the delightful Mr Guan “US is insolvent and faces bankruptcy as a pure debtor nation but the rating agencies still give it high rankings “ !
The official news agency , Xinhua, immediately published an editorial wildly praising Dagong. It lauded Dagong’s report as a significant step toward breaking the monopoly of western rating agencies of which it said China has long been a “victim”. No doubt Dagong’s report was cleared with the powers that be and his comments vetted – how is it that the possibility that it might just be a tad too funny to claim politicisation of western credit agencies in the same breath escaped these mandarins ?
And Dagong’s aim is to break into the world credit rating market. Fat chance.
Sometimes, they just don’t get it.
China likes to develop everything by itself. It doesn’t like Google; it has Baidu instead. Doesn’t like Facebook, YouTube, Blogger, …….., I can go on and on. Every one of them has a local equivalent. It’s not just in IT. Take Credit rating. It wants its own credit rating agency. Enter Dagong Global Credit Rating. It has about a quarter of China’s own fledgling credit rating market, and of course zilch of the global market. It started life with a “technology agreement” with Moody’s back in the mid 90s and having learnt the ropes, kicked them out – that’s par for the course for business here.
Back to the delicious irony of Mr Guan’s comments. Western credit rating agencies are politicised and in the same sentence he argues for China to have a say in how credit risks of states are judged !! To an outsider, it would appear that you could accuse Moody’s , S&P and Fitch of lots of faults, but being “politicised” is the last thing that comes to my mind. But from behind the myopic lenses from inside Beijing, it is understandable that it looks that way, because everything else here is that way.
He then goes on to criticise the practice of “rating shopping” wherein companies shop among the Big 3 to see who would give the best rating and give the business to them. Yes, there was much of that in the boom time, but Mr Guan, this is called competition. It is anyday better to have rating shopping than to have a single agency that would take its orders from the government.
And then, as is the wont here, Dagong published its own ratings for soverign countries. No prizes for guessing which country comes above the United States, Britain, France, Japan …… Another delicious comment from the delightful Mr Guan “US is insolvent and faces bankruptcy as a pure debtor nation but the rating agencies still give it high rankings “ !
The official news agency , Xinhua, immediately published an editorial wildly praising Dagong. It lauded Dagong’s report as a significant step toward breaking the monopoly of western rating agencies of which it said China has long been a “victim”. No doubt Dagong’s report was cleared with the powers that be and his comments vetted – how is it that the possibility that it might just be a tad too funny to claim politicisation of western credit agencies in the same breath escaped these mandarins ?
And Dagong’s aim is to break into the world credit rating market. Fat chance.
Sometimes, they just don’t get it.
