Downgrades were no fault of rating agencies, we have over-borrowed – Atuahene

A Banking Consultant, Dr Richmond Atuahene, has stated that it is through no fault of rating agencies that Ghana has experienced downgrades in the past few years; the latest of which has led to the country being shut out of the international capital market.

According to him, various researches he conducted, that took into consideration the country’s debt position, showed that the rating agencies have shown consistency in accurately classifying the Ghanaian economy.

He added that Ghana’s economy started seeing downgrades when the country’s debt skyrocketed to the extent that it had to suspend some interest payments.

“So, in 2020, we were downgraded 11 times by these 3 rating agencies [Fitch, Moody’s, and S&P], the last one came in when the government decided in December that it was going to suspend interest payments in addition to the domestic debts. Then the country was actually proclaimed to have defaulted,” he intimated.

He added that “But it was not their fault because we had borrowed to such an extent that our revenue generation and domestic revenue generation were not enough to service the debt. Ukraine has come in, COVID has done its own job but we have not actually managed the debt to the best of our ability. And so, classifying it as a downgrade was no news to some of us because there was clear evidence that we have over-borrowed and we have not been able to manage our finances very well to meet international standards.”

SSD/FNOQ

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