Accra, Sept. 17, GNA – Ghana’s credit rating
has been upgraded from a B- to a B by Standard and Poor’s (S&P), following
their recent assessment of the country, and has given Ghana a stable outlook,
for the first time in almost a decade.
A statement issued by the Ministry of Finance
said the upgrade had come about as a result of strong efforts in monetary and
fiscal policies.
It noted that debt dynamics had declined
significantly for the first time in almost a decade, with the primary balance
recording a surplus for the first time in almost a decade and a successful
issuance of bonds at international markets during a global economic downturn.
Mr. Ken Ofori-Atta, Minister for Finance,
congratulated the management of the Ministry and its agencies, adding: “…Going
forward, investors are upbeat about the progress. We need to sustain the
progress made so far and not derail in our efforts.”
The statement said sovereign credit ratings
were a key evaluation principle for a country’s economic and political
environment, which gives investors insight into the level of risk associated
with investing in a particular country and has implications sourcing for
cheaper funds on the international capital market; commitment to transparency
in political and economic development; and for the possibility of increased
foreign direct investment.
S&P noted that the upgrade reflected its
assessment that Ghana’s monetary effectiveness had improved, albeit from a low
base, and will support the credibility of the inflation-targeting framework
over the period, adding that “the stable outlook balances Ghana’s fairly robust
growth prospects, decreasing inflation, and narrower current account deficits
against risks from still-high budget deficits and high stock of public sector
debt”.
The statement said efforts to achieve this
upgrade had been futile for almost a decade as economic downturns and
volatility in outcomes had persisted for some time, while public debt dynamics
increased consistently since 2006.
S&P has been rating Ghana since 2003. At
the time, Ghana achieved a B+ with a stable outlook. Ghana maintained this
rating bill till December 2008 when Ghana’s stable outlook was revised downward
to a negative position.
Ghana is rated by three rating agencies, Fitch
Ratings, Moody’s and Standard and Poor’s. To support the evaluation process,
Standard Chartered Bank provides advisory services for Ghana to the rating
activities.
GNA