Calls For African Credit Rating Agency Grow Louder

Calls for the establishment of an African-led credit rating agency sounded out again during a dialogue organized by the UN Economic Commission for Africa (ECA) and other organizations in Washington, DC a few days after the conclusion of the IMF-World Bank Spring Meetings.

Experts have long observed that African economies face mounting credit rating challenges, including perceptions of bias, lack of transparency and inconsistencies in rating methodologies. Many, including ECA Executive Secretary Claver Gatete, have called for the establishment of an African-led credit rating agency to improve the continent’s access to finance.

“With more than 30 African countries subject to sovereign credit ratings, the decisions of global rating agencies significantly impact debt sustainability and access to international financial markets. At a high-level dialogue held on the sidelines of the 2025 IMF-World Bank Spring Meetings, African institutions and global credit rating agencies reaffirmed their commitment to developing a fair, transparent, and inclusive credit rating ecosystem for Africa,” reads a press release issued by UNECA.

Against a backdrop of rising market volatility, sovereign defaults and constrained fiscal space, the dialogue aimed to address urgent reforms in Africa’s credit rating framework, according to the presser, that went on to say that the global rating agencies “reaffirmed their commitment to developing a fair, transparent, and inclusive credit rating ecosystem for Africa”.

It is not clear if the planned rating framework for Africa would lead to an African agency that replaces the roles of the global rating giants in assessing the creditworthiness of African nations in the future, or if it would just provide for the three rating agencies to establish African-sensitive operations.

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The dialogue was organized by the African Union’s African Peer Review Mechanism (APRM), the United Nations Development Programme (UNDP), UNECA, AfriCatalyst, and the African Center for Economic Transformation (ACET), and hosted at the Open Society Foundations.

Representatives from Moody’s, S&P, and Bank of America were also in attendance, and participated in a “candid discussion on financing solutions for African countries”, according to the press release.

However, experts pointed to what they described as structural issues, including data gaps, methodological opacity, and under-engagement between African governments and the ‘big three’ global rating agencies (Moody’s, S&P, and Fitch), as barriers to accurate ratings.

During an event on the sidelines of the Spring Meetings, Gatete highlighted Africa’s financing paradox, as only two countries on the continent are rated investment grade despite a combined GDP of over USD three trillion, and called for change.

“Ultimately, a healthy credit rating ecosystem goes beyond evaluating risk – it becomes a platform for mobilizing capital, improving creditworthiness, and supporting Africa’s broader development goals,” he said.

The release also quoted UNDP Regional Director for Africa, Ahunna Eziakonwa, as saying, “We must rethink how creditworthiness is defined and measured.”

Other experts who attended the dialogue emphasized the need to “respond to inaccurate or unfair credit ratings and steps toward creating an African credit rating agency that complements and expands existing credit ratings coverage globally.”

“Given the ongoing stress in African governments related to both cost of capital and access to capital it is critical to ensure that credit ratings reflect the many different African contexts. This initiative is an important step in that regard – particularly engaging the credit rating agencies,” said Mavis Owusu-Gyamfi, president and CEO of ACET.

Experts at UNECA say transparent and regular engagement between rating agencies, investors, and African governments, as well as local capacity building and collaboration, are crucial for establishing an African rating agency that can provide credible and contextual alternatives to global ratings.

It is not clear if and in what way the outcomes of the dialogue on the Africa-led rating framework would contribute to efforts to reform the global financial architecture. The dialogue also failed to provide a timeline for the establishment of an African credit rating agency.