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Containers are stacked at a pier in Busan Port on the afternoon of April 3. / Source: Yonhap News

S&P Global Ratings has reaffirmed South Korea’s sovereign credit rating at 'AA' with a stable outlook, maintaining the same level it has held since 2016.

In its announcement on April 15, the international credit rating agency said that while deteriorating global trade conditions are likely to weigh on South Korea's economic growth, the country is still expected to outperform most other high-income nations over the next three to five years.

S&P projected that Korea’s GDP growth would slow to 1.2% this year due to the challenging trade environment, before rebounding to 2.0% in 2025. The economy is forecast to grow at an annual average of around 2% from 2025 through 2028, with per capita GDP expected to surpass $41,000 by the end of the period.

The agency highlighted Korea’s institutional and policy frameworks as key strengths supporting its creditworthiness. It noted that although the unexpected declaration of martial law had slightly undermined political stability, the swift reversal of the measure helped mitigate potential negative impacts.

S&P added that adherence to legal procedures surrounding the scheduling of the presidential election helped avoid major disruptions to social and economic stability. However, it cautioned that prolonged political polarization could weaken the next administration’s ability to implement policy effectively.

In response, South Korea’s Ministry of Economy and Finance welcomed the decision, saying, “S&P’s affirmation of Korea’s AA rating with a stable outlook reaffirms strong international confidence in the Korean economy. Despite heightened domestic political uncertainty and shifting global trade conditions, this decision sends a positive signal regarding Korea’s external credibility.”

The ministry also noted that Deputy Prime Minister Choi Sang-mok had met with S&P officials in March as part of the government’s annual engagement process with the agency. “We are fully committed to managing Korea’s external credit standing through a coordinated inter-ministerial approach and will continue to actively engage with global rating agencies like S&P, Moody’s, and Fitch,” it said.