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Moody’s Revises Outlook On Ghana’s Rating to Stable From Negative

Sept. 27, 2016    The International Credit Ratings Agency, Moody’s Investor Services (“Moody’s) revised the outlook on Ghana’s Long Term Bond Ratings from Negative to Stable and affirmed the rating at B3[1].
2.         The revision of the outlook at this time is testimony to the prudent policies adopted by the Government since 2014 via the Home Grown Programme and consolidated in the IMF Programme.
3.         According to Moody’s the key drivers for the stabilisation of the rating were:

  • Significant fiscal deficit reduction and success in implementing structural reforms over the past year
  • Reduced government liquidity risk on the external side following the issuance of the US$750m Eurobond, the proceeds of which are earmarked for debt repayments
  • Improved balance of payments dynamics, including improved FDI inflows and continued development of oil and gas resources

4.         Moody’s had previously rated Ghana at B3/ Negative Outlook since March 2015. This positive action comes at a time of improving macroeconomic and fiscal indicators and follows our recent successful Eurobond issuance of US$750mn, priced competitively at 9.25%, in September 2016.
5.         This issuance marked the Eurobond from Sub-Saharan Africa (ex RSA) in 2016 and, demonstrates confidence from the global investor community in the consolidation of Ghana’s turnaround story.
6.         In their report, Moody’s highlight our ongoing fiscal consolidation and strong fiscal discipline as credit positives. Commitment to this level of prudence was recently codified into law via the Public Financial Management Law. Moody’s also praised Ghana’s prudent debt management strategy including the decision to utilise proceeds of the recent Eurobond to redeem upcoming external debt maturities, reducing rollover risks.
7.         The Stable Outlook reflects Moody’s view that the reforms adopted by the Government will remain in place and continue to deliver improved economic performance over the next 12 – 18 months. Together with the successful bond issuance, this rating action demonstrates the increasing confidence of international markets stakeholders in Ghana’s turnaround story.
8.         Ghana is also rated by Standard & Poor’s and Fitch Ratings at B-/ Stable Outlook and B/ Negative Outlook, respectively.
Information on Moody’s: Moody’s Investor Services is an International Rating Agency. Moody’s has rated Ghana since December 2012. Moody’s publishes a semi-annual credit report on each Sovereign it rates. In addition, Moody’s publishes regular commentary on current events and developments which are relevant to the Credit Rating.

[1] Moody’s B3 rating is equivalent to a B- rating from Fitch and S&P and one notch lower than B.


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