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Barely A Week After S&P Downgrade, Another International Agency Downgrades Ghana’s Economy

Ghana is currently in difficult times as the country seeks to rise from the ashes the economy has found itself in. After a lengthy wait, Ghana decided to seek financial bailout from the International Monetary Fund. However, before this helps comes, the country is in turmoil economically. Many financial institutions are downgrading the economy.

Initially, the government debunked all calls that the economy was in a mess. When thing eventually got to a critical stage they run to the IMF and blamed external shocks for how the economy has turned. Aside blaming the economy, the Akufo-Addo led government also blamed the former John Mahama government for some of the policies it took regarding the economy.

It has been 5 days since Standard and Poor, a major financial institution downgraded Ghana’s economy from B- to CCC+. They tagged the economy as a junk economy and called it negative. Government is still yet to come to terms with this rating. Today, Wednesday, August 10, 2022, Fitch, a leading rating agency has also downgraded Ghana from B- to CCC+.

According to Fitch, the latest downgrade is because of Ghana’s public finances, which has contributed to prolonged lack of access to the Eurobond market, a move which has led to significant decline in external liquidity. With this new rating, it is certain that investor confidence will be hit hard and they will see Ghana as an unfavorable place to trade or invest.

The dollar is currently trading for over 9 cedis to $1 as prices of goods keep rising. Yet, the government keeps reminding Ghanaians to blame John Mahama and the Ukraine-Russian War. Yesterday, in an interview the President boldly stated that he will not reshuffle his government because they have performing outstandingly. What then does this rating mean? What then is the cause of the failure of the economy? Who is to be blamed?

Use the link below to read the full report from Fitch.

https://www.fitchratings.com/research/sovereigns/fitch-downgrades-ghana-to-ccc-10-08-2022#:~:text=Fitch%20Ratings%20%2D%20Hong%20Kong%20%2D%2010,of%20'CCC%2B'%20or%20below

Content created and supplied by: Still_Unbeatable (via Opera News )

Akufo-Addo Ghana International Agency International Monetary Standard and Poor

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