The Senegalese head of state, who is the current chairman of the AU, wants a less subjective rating of African economies. Macky Sall advocates the creation of a Pan-African credit rating agency. “The current risk assessment system is out of step with the economic reality in Africa and this has consequences,” he said on Saturday, May 14, during the Dakar 2022 Economic Conference hosted by African economists. Only it will be necessary to have patience before seeing this agency replace the ones that already exist.
as reported from Dakar, Birahim Toure
It is almost with annoyance that the President-in-Office of the African Union notes Africa’s handicap in front of financial credit rating agencies. Macky Sall.
“It’s just fair, the need for us to face injustices on ratings, sometimes very arbitrary, to have a Pan-African credit rating agency,” said President Macky Sall.
Macky Sall, the current AU chairman, wants a Pan-African financial credit rating agency
“In 2020, when all economies felt the effects of Covid-19, 18 out of 32 African countries – rated 18 out of 32 – by at least one of the major credit rating agencies, had their ratings downgraded. So this represents 56% of deteriorating ratings for African countries against In addition, studies have shown that at least 20% – 20% – of the grading criteria for African countries are based on rather subjective factors, cultural or linguistic, and therefore not related to the parameters that measure the stability of an economy. the consequence is that the perception of investment risk in Africa is always higher than the real risk “, explained President Macky Sall.
The need for a “credible” agency For Dr. Serigne Ousmane Beye, a professor at the Faculty of Economics and Management at Cheikh Anta Diop University in Dakar, the idea is really attractive, it is feasible, but it will take time.
“Undoubtedly, so that it is operational immediately. Because, you see, to establish the credibility of this agency, the countries can do it, because you have the credibility of the financial institutions that will trust us and will entrust your rating work, but we can always maybe try to go there. Obviously, while trying to deal effectively, to take seriously what we do.
A Pan-African credit rating agency already exists, it is the GCR group that exists in about thirty African countries, but it awards ratings in local and not international currencies.
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