Ghana's B+/B ratings affirmed

... as oil bolsters prospects; outlook stable
Standard & Poor's Ratings Services affirmed its 'B+' long-term and 'B' short-term sovereign credit ratings and stable outlook on the Republic of Ghana.

S&P said the affirmation reflects accumulating evidence that Ghana will benefit substantially from offshore oil production from the end of this decade, offsetting the ongoing weakness in its fiscal and external performance by 2011 at the latest.

However, Ghana's oil finds increase the importance of strong fiscal governance and monetary management to rating prospects, S&P noted.

The stable outlook is predicated on continued political stability and the prospect of nationally significant oil wealth, S&P added.

S&P said the country's ratings could also come under pressure if it embarked on policies that endangered relations with donors or if government oil-related revenues looked unlikely to materialize.

Conversely, reforms that tangibly bolster fiscal sustainability and governance could underpin rating improvements in the medium term, S&P said.