Moody’s upgrades Ghana’s ratings to ‘Caa2,’ revises outlook to positive

International credit rating agency Moody’s has upgraded Ghana’s long-term local and foreign currency issuer ratings to “Caa2” from “Caa3” and “Ca,” respectively, citing extensive debt treatment that has significantly alleviated the government’s financial burdens.

Moody’s upgrade Ghana on Friday October 11.

The agency also revised the West African country’s outlook to “positive” from “stable.”

The “positive outlook reflects the potential for liquidity risk to ease amid ongoing fiscal consolidation efforts supported by an IMF programme,” Moody’s said in a statement.

Last week, the International Monetary Fund staff and officials in Ghana reached an agreement on their third review of the country’s $3 billion loan programme.

In October, more than 90% of Ghana’s bondholders approved a $13 billion debt overhaul, paving way for the gold and cocoa producer to emerge from its near $30 billion debt default in 2022.

Ghana’s debt restructuring is expected to reduce its debt stock by $4.7 billion and provide cash flow relief worth a total of $4.4 billion during the period of the IMF programme, which expires in 2026, the government said in June.

The country’s statistics agency said in September that Ghana’s economy grew by 6.9% in the second quarter of 2024, the fastest in five years.

Moody’s also said it expects the country’s debt to keep decreasing, though at a slow pace as the government resumes paying interest and principal on all its debts.

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