Ratings agency, Standard & Poor’s has rated Ghana B/B. In a Press release, S&P said even though Ghana continues to benefit from strong GDP growth, strengthening oil production volumes, and political stability, the country continues to suffer from weak fiscal management highlighted by a widening of the fiscal deficit in 2010 and increased supplier arrears. S & P believes the looming elections could further erode fiscal discipline with forthcoming oil revenues possibly used as an excuse to ramp up spending even more. The ratings are an assessment of any country’s competitiveness in accessing credit on the international market. The details are captured in the following report S&P says the ratings are constrained by views that Ghana’s fiscal management is weak and has contributed to large fiscal deficits and supplier arrears. The ratings are also constrained by low economic development and–despite oil production commencing–a still-narrow economic profile. It continues, “the government’s weak payment culture and fiscal discipline continues to be highlighted by the net new accumulation in 2010 of further arrears amounting to 1.9% of GDP.” “We expect the 2011 fiscal deficit to exceed the budget plan and reach 6% of GDP. The statement says although improving, we continue to be concerned as to the extent of contingent liabilities that could crystallize from state-owned enterprises (SOEs) and the banking sector. S&P believes that receipts from the oil sector should begin to improve fiscal flexibility in the medium term, provided that spending can be contained. S&P observes that, despite accumulating new arrears on its own account, the government has paid off a substantial portion of arrears owed by an SOE, Tema Oil Refinery (TOR), to Ghana Commercial Bank, a key player in the domestic banking sector. It indicates also that the Petroleum Revenue Management Bill, passed in 2011, has added clarity to government oil receipts. Furthermore, Ghana is one of Africa’s most established democracies, with both major parties having taken a turn at relinquishing power after losing elections. According to S&P, the Multilateral Debt Relief Initiative (MDRI) contributed to a significant reduction in Ghana’s net external debt in 2006, but the public sector has been re-leveraging ever since; general government debt reached 38% of GDP at year-end 2010. A bilateral loan from China may lead to a further ramp up in debt over the next few years.