On the morning of July 19th, 2016, the 2016 World Credit Rating Forum was held in Beijing. At the meeting, Universal Credit Rating Group (UCRG), one of the Forum’s organizers,N proposed a statement to integrate credit rating into the world’s economic governance system.
When the 2008 crisis abruptly stormed the financial market, the world was astonished to see the Wall Street, the FED, multiple financial institutions, homebuilders, and even the government of United States left stunned and unprepared. Ironically, upon the crisis,N the ‘Big Three’ credit rating agencies still maintained a high rating towards the U.S. without recognising the fact that such a rating would never support a robust economy. The world was forced to face not only the outrageous subprime credit crisis but also a predicament for the global economy and credit distribution.
Summit on Construction of Asian Credit System, sponsored by Universal Credit Rating Group (UCRG) and organized by Dagong Global Credit Rating Co., Ltd. was held under the support of the Ministry of Foreign Affairs and China Center for International Economic Exchanges (CCIEE) on 23rdJune, 2014, in Beijing.
After the global financial credit crisis of 2008, the international community called for commitment to reform the existing international credit rating system and establish a new international credit rating system that represents the common interest of mankind and undertake the responsibility of assigning ratings to entities across the world. It is against this backdrop Universal Credit Rating Group (UCRG) was founded. UCRG is a new type of multi-lateral international credit rating agency aimed at being sponsored by representative agencies from every jurisdiction.
UCRG's purpose is to promote the establishment of a new type of international credit rating system providing an alternative rating for the pervasiveness of credit relationships while the current international rating system with sovereign-owned characteristics is running, so that a new rating architecture featuring co-existence of two rating systems, openness, inclusiveness, inter-complementary and counter-balancing will be created.
Universal Credit Rating Group
The global credit crisis has made the international community awaken to the fact that credit rating has a stake in the sound development of human society, the western-dominated global rating system is no longer capable of undertaking the responsibility of assigning credit ratings to entities across the world and thus a new international rating system representing the common interest of humanity must be launched. Such awareness, reflecting the mainstream mindset of the modern era, has actuated the reform of the global rating system. It is against this backdrop, UCRG was founded.
Over the recent period, the world has been facing major economic challenges threatening long-term stability. In Europe, the UK’s referendum on its EU membership has disturbed financial markets and highlighted the growing distrust towards economic and political institutions. China, at the same time, is experiencing slowdown and gradual reforms. In South America, many markets are going through sharp recession. The drop in oil prices has at the same time created a major strain for oil producing countries, in particular in the Middle East, weighing on their banking and credit system. In the Eurozone as well as in the USA, quantitative easing lacks the ability to stimulate real economy and negative interest rates are still inhibiting growth. In all of these contexts, it seems that the lessons of the last global crisis have not been taken. Since 2008, global debts have risen much faster than growth. The main engines of global GDP are weakened by sluggish investments, overcapacity and low demand. Against such a background, we have to take all possible measures to avoid the next global credit crisis. >
Dual rating system is the business model of UCRG. This unique model will be put into practice by the approach that governments of the jurisdictions where UCRG operates grant UCRG a license to conduct credit rating business in the local rating markets, for UCRG represents the common interests of mankind. >