African Union launches Mauritius-based credit agency to challenge borrowing costs
The African Union is launching the Africa Credit Rating Agency (AfCRA) in Mauritius, offering ratings of governments, companies and financial institutions alongside Fitch, Moody’s and S&P. The AU says the agency will bring an African perspective to credit assessments; its credibility with investors will depend on demonstrating independence and rigour.
Bottom line — AfCRA’s first ratings will test whether it can earn investor trust and help lower Africa’s borrowing costs.
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The African Peer Review Mechanism says 23 African economies have no rating from the three established agencies.
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According to the OECD estimates cited by Gulf News, African borrowers paid about €8.30 for every €92 borrowed in international markets in 2024, compared with about €4.30 in emerging Asia and €6.00 in Latin America.
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The AU said Africa’s annual external debt service rose to €150 billion in 2024, from €56 billion in 2010.
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The AU says AfCRA will operate independently, funded through shareholder capital and its operations; it has not disclosed the shareholders.
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The AU presents AfCRA as a complement to existing agencies, not a replacement. It will also rate non-African entities where appropriate.
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Reuters reported that a 2024 investigation found no evidence of systemic bias in the Big Three’s sovereign ratings for Africa; the agencies say they apply their methodologies globally.
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Gulf News quoted analysts who said investors will look for evidence of independence, including whether AfCRA is willing to downgrade an African government.