Singapore maintains it AAA Credit Rating, when even the largest economy in the world US credit rating slipped to AA+ due to the debt limit standoff. The AAA credit rating is basically the top rating for debt in the world. It means that they are safest borrowers in the world and lenders should feel comfortable lending to them. It also means that Singapore government will be able to borrow at very low rates as compared to other governments.
According to Moody’s, Singapore gets the top rating due to 3 main reasons.
1. Strong Fiscal Position
The fiscal strength of Singapore is basically supported by prudent policies and the large size of the government assets. Singapore also consistently generates a budget surplus and is expected to have a surplus of $1.6 billion in FY 2014.
The fact Singapore has a fully funded compulsory pension system, which is the CPF, ......