The Africa Credit Rating Agency (AfCRA) is expected to launch in June 2025, aiming to provide fairer assessments of African economies and address concerns over global credit rating biases
African nations are preparing for the launch of the Africa Credit Rating Agency (AfCRA) in June 2025, an initiative designed to offer more accurate and context-sensitive credit ratings for sovereign governments, public-sector entities, and corporations across the continent. This move comes in response to longstanding concerns that the “big three” global rating agencies—Moody’s, Standard & Poor’s, and Fitch—apply methodologies that underestimate Africa’s economic potential, leading to inflated borrowing costs.
Sovereign credit ratings play a crucial role in determining a country’s access to international capital, influencing borrowing costs and investment flows. Over the past decade, 94% of African nations have faced credit rating downgrades, significantly impacting their ability to secure financing on competitive terms. Estimates suggest that misperceptions of risk have cost the continent over US$46 billion in forgone lending opportunities and US$24 billion in excess interest payments.
Kenyan President William Ruto has criticised the global agencies for their “flawed models, outdated assumptions, and systemic bias” in assessing African economies. In contrast, AfCRA aims to introduce a more transparent and localised methodology that reflects Africa’s economic realities, incorporating factors such as natural assets, informal economies, and long-term development potential.
The establishment of AfCRA is expected to not only complement existing agencies but also encourage fairer evaluations of African creditworthiness. With 22 African nations currently unrated by any credit agency, AfCRA could bridge this gap while influencing international credit rating practices. The initiative marks a significant step towards reducing Africa’s borrowing costs and strengthening its position in global financial markets.
