Ghana to receive positive rating if it secures agreement with foreign creditors, Fitch says

Fitch Ratings has indicated that Ghana has the potential to receive a positive rating if it successfully reaches an agreement with private creditors regarding the restructuring of its foreign-currency-denominated external debt.

This positive rating would be assigned based on a forward-looking assessment of Ghana’s willingness and capacity to meet its foreign-currency debt obligations, ultimately allowing the country to access international borrowing in the medium term.

The recent improvement in Ghana’s rating from “Restrictive Default” to “CCC” came after the completion of its domestic debt exchange program.

However, Fitch has issued a cautionary note, suggesting that any renewed liquidity challenges arising from significant delays in the external debt restructuring process could increase the likelihood of further restructuring.

In the context of sovereign credit ratings, Fitch also highlights that Ghana’s “Country Ceiling” is currently assessed at ‘B-‘. For sovereigns rated ‘CCC+’ and below, Fitch typically starts with a ‘CCC+’ as a reference point when determining the Country Ceiling, which is an important factor in assessing a country’s creditworthiness and its ability to access international financial markets.