In light of?the sluggish economic growth, high government debt ratio, rising borrowing costs and exposure to Europe's debt crisis in France, Dagong Global Rating Co downgraded the local and foreign currency sovereign credit rating of the country from AA- to A+ with a negative outlook, the rating agency said Thursday.

The move came after Standard and Poor's Monday put the long-term sovereign-debt ratings of 15 eurozone nations, including the area's six AAA rated countries, on negative watch.

Dagong?said France's economy has been losing its competitive edge in recent years, with its share of global exports consistently dropping.

Dagong said it expects France's economic growth rate to slow to 1.7 percent and 0.3 percent in 2011 and 2012, respectively, while maintaining an annual average growth rate of 0.8 percent in the medium-term.

France is currently stuck between preventing an economic slowdown and reducing its deficit and its economy will continue to be affected by the deteriorating eurozone debt crisis, Dagong said.

The French banking system's exposure to Portugal, Italy, Ireland, Greece and Spain reached 852.36 billion euros, stoking concerns over the banks' asset quality and profitability, Dagong said.