According to Ghana’s finance minister, Ken Ofori-Atta, the country’s return to the international capital market may not happen anytime soon as a result of the negative effects of international rating agencies downgrading its economy.
Fitch, Moody’s, and Standard & Poor’s, the three rating agencies, have all reduced the nation’s credit worthiness to junk status.
He claims that in order for the government to have simple access to the market, it needs to work on its present economic downgrade and other budgetary measures.
It will take some time to get back on the global capital markets. Before that time, we won’t be able to work on our ratings for around two to three years. The most recent downgrade is quite regrettable, he said.
On September 28, 2022, he was addressing a press conference about the state of Ghana’s economy.
Due to a number of negative economic circumstances brought on by a weak local currency and high debt levels, Ghana has been absent from the global market.
According to Mr. Ofori-Atta, policy changes will be made in the coming years to reverse the present downgrading of the nation’s rating by Fitch, Moody’s, and Standard & Poor’s, laying the groundwork for Ghana to return to the international capital market.
In order to avoid having to pay high coupon rates, he recommended that managers of the economy should closely evaluate the current state of the economy before returning to the capital market in the following two or three years.
Mr. Ofori-Atta expressed his opinion regarding Fitch’s recent downgrading of Ghana’s economic standing and said the action was regrettable and probably would have a negative impact on Ghana’s bond market.
He criticized a recent Bloomberg article that claimed Ghana’s internal debt restructuring was the cause of Fitch’s recent downgrading of the nation’s credit rating.
The Finance Minister is optimistic that a solution would be reached to restore investor confidence in the economy as Ghana is currently in negotiations with the International Monetary Fund.
Once more, he wants the agreement to be signed before the November 2022 presentation of the following budget (2023).