Moody's upgrades Ghana's credit rating, cites debt treatment, IMF programme

Moody's, a global credit ratings agency on friday Octber 11, 2024,  raised Ghana's long-term local and foreign currency issuer ratings from "Caa3" to "Caa2" and from "Ca" to "Caa2", respectively.

This upgrade is a testament to the government's efforts to alleviate its financial burdens through extensive debt treatment.

The upgrade is also attributed to Ghana's positive economic outlook, which has been revised from "stable" to "positive".

According to Moody's, this positive outlook reflects the potential for liquidity risk to ease amid ongoing fiscal consolidation efforts, supported by an International Monetary Fund (IMF) program.

Ghana's economy has been on the rebound, with a remarkable 6.9% growth in the second quarter of 2024, the fastest in five years, according to the country's statistics agency.

This growth is driven by key sectors such as services, industry, and agriculture.

Key Sector Performances:

- Services Sector: Grew by 5.8%, contributing significantly to the economy
- Industrial Sector: Expanded by 9.3%, driven by mining and quarrying
- Agricultural Sector: Grew by 5.4%, despite challenges in the cocoa subsector 

Moody's expects Ghana's debt to continue decreasing, albeit at a slow pace, as the government resumes paying interest and principal on all its debts.

This development is expected to further boost investor confidence and support economic growth.

Source: Lead News Online