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S&P downgrades Ghana from B- to CCC+ - Report - www.asempanews.com

S&P downgrades Ghana from B- to CCC+ - Report - www.asempanews.com

American credit rating agency, Standard and Poor’s (S&P) Global Ratings on Friday, August 5, pushed Ghana’s debt further into speculative territory, lowering its foreign and local currency sovereign ratings to CCC+/C from B-/B.

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According to a report by marketwatch.com, S&P said its outlook for the country remains negative, “reflecting Ghana’s limited commercial financing options, and constrained external and fiscal buffers.”

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S&P which is one of the ‘Big Three’ credit-rating agencies, including Moody’s Investors Service and Fitch Ratings, in their report stated that the “Covid-19 pandemic and the conflict in Russia have magnified Ghana’s fiscal and external imbalances.”

S&P Global Ratings noted that Ghana has also been affected by a lack of access to Eurobond markets with local authority’s passage of a levy on electronic transactions and legislation to tighten exemptions on tax payments including for VAT, among other moves.

“While these changes could improve the tax take going forward, the situation remains challenging, and over the first half of 2022, the fiscal deficit has exceeded the government’s ambitious target,” S&P Global Ratings stated.

S&P Global Ratings had affirmed Ghana’s ratings in February, as Moody’s downgraded the country to Caa1 with a stable outlook.

The Central Bank, Bank of Ghana, has indicated that, Ghana’s public debt has increased to 78.3 per cent of GDP (GH¢393.4 billion) at the end of June 2022, compared with 76.6 per cent of GDP (GH¢351.8 billion) at the end of December 2021

Original Story on: AsempaNews
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