Credit ratings can be described as a category or grade that represents a government's ability and willingness to repay its debts fully and on time. An implicit probability of defaulting can be associated with a credit rating. 

Credit ratings are very important for countries because they determine the cost of funding in capital markets and they enable access to derivative and loan contracts.

In recent years, the number of ratings and their importance has increased considerably. In a more globalized and complex world, investors need standard metrics to compare the credit quality between issuers, even if they belong to very different countries. Although they are not an exact science, as the Credit Rating Agency (CRA) Standard & Poor's argues, credit rating establishes a ranking of countries according to their solvency. They are considered an important reference for investors and international organizations. In the following table, the different grades and their meanings are described: