Ghana will use its New Economy programme to push for an investment-grade credit rating.
This is to lower the country’s borrowing costs and help Ghanaian businesses raise long-term financing, Finance Minister Dr. Cassiel Ato Forson has said.
Speaking at a New Economy engagement in Accra, Dr. Forson said Ghana’s domestic bond market had largely ground to a halt in 2022.
He said local banks lost access to credit lines in the wake of the country’s debt default and the Domestic Debt Exchange Programme.
“Now we have restored it and the country is now rated B,” he said. “We want to get to investment grade.”
An investment-grade rating signals that a rating agency considers the risk of default lower. It could bring Ghana’s government bonds within reach of more institutional investors, including funds that can only buy bonds above a minimum credit rating.
A wider pool of investors could help the government borrow at lower interest rates.
The benefits could extend to Ghanaian businesses.
A stronger sovereign rating could improve financing conditions for companies and help deepen the domestic corporate bond market.
That would give businesses more scope to raise long-term funds from investors to buy equipment, expand production and finance new projects.
“If we are able to get to investment grade, we would have laid the foundation for corporate bonds and others to take off,” Dr. Forson said.
He said reaching that goal would require Ghana to keep its economy stable and predictable and show that it has the policies to sustain those gains.