economics · 26 Feb 2025
Why does Africa need an independent credit rating agency?
African sovereigns pay more to borrow than nearly any other emerging market. The misperception of risk has cost the continent an estimated US$46 billion in forgone lending. With the launch of the Africa Credit Rating Agency, that era may be ending.
Despite liberalising their economies and carrying out painful structural reforms, African sovereigns pay more to borrow than nearly any other emerging market. The "big three" — Moody's, S&P, and Fitch — have underinvested in African coverage and tend to lump the continent together. The misperception of risk has cost Africa an estimated US$46 billion in forgone lending. With the launch of the Africa Credit Rating Agency, that era may be ending.
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Originally published on NTU CAS.