Two credit rating agencies – Moody’s Investor Services (Moody’s) and Standard and Poor (S&P) have confirmed Ghana’s credit rating at B3 and B- respectively.
The agencies also maintained Ghana’s outlook.
A statement issued by the public relations unit of the Ministry of Finance and made available to the Ghanaian news agency in Accra, said that credit rating agencies, in their decisions, have taken the improvement into account. Ghana’s growth prospects, resilient external sector performance and continued access to capital markets (domestic and international) as critical factors in sustaining the rating and outlook.
Notably, the two rating agencies recognized the government’s efforts to “build back better” through the innovative Ghana CARES (Obaatanpa) program, he said.
The statement noted that both credit rating agencies recognize that Ghana’s economy is recovering from the effects of the pandemic faster than its peers, adding that the government should however focus more on growth and implementation of the program. CARES from Ghana.
S&P, in particular, he said, maintained Ghana’s rating thanks to the growing economic outlook and relatively transparent and responsive political institutions.
The stable outlook balances the risks of external financial and financial pressures against the country’s medium-term economic growth prospects, he added.
Both credit rating agencies, however, raised concerns over Ghana’s affordability and debt levels, but the government has said it is committed to ensuring debt sustainability and fiscal consolidation.
“As such, between 2019 and 2021, the government took various liability management measures to proactively reduce the external debt stock and the interest expense burden. As a result, the government repurchased and withdrawn more than 900 million dollars of Eurobonds, which considerably reduced the outstanding external debt ”, assured the press release.
Nationally, he said the government continues to conduct active accountability management, claiming that this year alone, GH ¢ 4.84 billion has been used for national accountability management, which involved the redemption of three years and five years. obligations.
“This reduced the risks of refinancing and rollovers and the interest charges inherent in the public debt portfolio. Our strategy has also had a positive impact on interest rates in the primary and secondary securities markets, ”he added.
The ministry assured the public that the government is doing its best to immunize the majority of adult Ghanaians to obtain collective immunity, a need that has become more urgent with the apparent third wave.
To that end, he said Ghana was in constant talks with the African Vaccination Acquisition Trust (AVAT) for the supply of 17 million Johnson and Johnson doses.
Ghana is one of 27 African countries that have completed the initial deposit and fulfilled the legal requirements, preparedness checklist and required emergency use authorization. The first batch of vaccine is expected this month as part of the program.
The statement reiterated that the main goal of the government, especially at the onset of the pandemic, had been to save lives and livelihoods, as such, it said the government had implemented various initiatives and vital interventions in 2020/21 to protect the general population. against the negative social and economic effects of the pandemic.
The interventions, however, he noted, resulted in large unbudgeted expenditures and high debt levels.
“However, Ghana’s economic fundamentals remain strong despite these interventions and the prospects for recovery are high. This is reflected in the positive discourse from rating agencies and other organizations such as the IMF on how Ghana handled the economy during the pandemic, ”the statement said.
He added that in addition, Ghana’s medium-term plan was underpinned by a strong strategy to safeguard growth beyond five percent in the medium term, returning to the budget path of less than five percent of the deficit. budget of gross domestic product and achieve a positive primary balance by 2024.
“We will maintain our progress and accelerate it through the Ghana CARES transformation program of GH ¢ 100 billion as part of the general policy of Ghana Beyond Aid and certainly beyond the pandemic,” the statement said.