China's largest steel maker, Shanghai Baogang Group Company (Baosteel), has one of the best credit ratings in the world, according to the latest rating report issued by Standard & Poor.

The company has been given an A-, up from a BBB+, one of only two global steel companies - South Korea's steel giant POSCO is the other - with that rating.

A statement from Baosteel said the upgrade reflected Standard and Poor's confidence in the company and will help them raise more funds on the overseas capital market.

Standard & Poor's gave Baosteel a BBB+ in its first assessment of the group in 1997, but reduced it to BB+ in 1999 following its merger with Shanghai Metallurgy and Meishan Iron and Steel Company. Baosteel was back up to a BBB+ rating in December 2004 after its business performance had improved.

Baosteel is China's largest iron and steel conglomerate. It ranks fifth in the world with an annual steel output of 20 million tons. It ranked 296 on Fortune Global 500 this year with a sales revenue of 126.6 billion yuan (16.2 billion U.S. dollars) in 2005.