International financial structure skewed against developing countries

President Nana Addo Dankwa Akufo-Addo has lamented that the international financial structure is skewed against developing and emerging economies like Ghana.

“The avenues that are opened to powerful nations to enable them to take measures that would ease pressures on their economies are closed to small nations,” he said at the 77th UN General Assembly meeting.

President Akufo-Addo also complained that credit rating agencies “have been quick to downgrade economies in Africa, making it harder to service our debts.”

Recently, Standard and Poor’s (S&P) global ratings downgraded Ghana’s foreign and local credit ratings from B-B’ to CCC+C with a negative economic outlook.

Before this, Fitch had downgraded Ghana’s Long-Term Foreign-Currency Issuer Default Rating (IDR) to ‘B-‘ from ‘B’ and the outlook was negative.

Moody’s Investors Service (Moody’s) also downgraded Ghana’s long-term issuer and senior unsecured debt ratings to Caa1 from B3 and changed the outlook to stable from negative.

Ghana’s debt was about to hit GH¢400 million in April 2022.

President Akufo-Addo fears these ratings are prejudiced and pushing developing countries deeper into debt.

He further described inflation as “the number one enemy this year”.

“Several African countries have inflation rates surging three to four times higher than what they were just two years ago. In Ghana, we are experiencing the highest inflation for 21 years. The high costs of food are hurting the poor, especially the urban poor, the most.”