Fitch downgrades Ghana’s currency issuer from B to B minus
Fitch has downgraded Ghana’s long term foreign currency issuer default rating.
Ghana has moved from to B from B minus.
Fitch in it’s recent rating described Ghana’s outlook as negative.
It balmed the rating on a surge in Ghana’s debt in the context of uncertainty regarding the ability of the nation to stabilize the debt situation.
It said : “General government debt reached an estimated 83% of GDP at end-2021, including approximately 2% of GDP in debt held through the Energy Sector Levy Act special purpose vehicle.
We forecast government debt to remain on an upward path through 2025, but expect debt to grow at a slower pace as the primary deficit narrows in 2022 and 2023.
Debt affordability metrics will remain weak. Ghana’s debt constitutes 539% of government revenue, compared with the ‘B’ median of 325%. Interest payments were 44.6% of revenue in 2020 and the ratio is likely to continue rising through 2023, assuming a rising share of domestic debt in total debt in the absence of external financing options,” the rating said further.