Audio By Carbonatix
Rating agency, Fitch, says it will assign Ghana a better rating if it receives satisfactory confirmation that the country has settled all the missed payments of its bonds.
According to the UK based firm, it will assign Ghana's Long-Term Local-Currency Issuer Default Rating (LTLC)) based on a forward-looking assessment of its willingness and capacity to honour its local currency debt.
This is coming after it downgraded the country’s sovereign debt to Restrictive Default.
It added that once the country reaches an agreement with private creditors on the restructuring of its foreign-currency-denominated debt and completes that restructuring process following the Common Framework official creditors' claims treatment, Fitch will assign a positive rating.
Ghana score 5 for Creditor Rights.
Meanwhile, the country recorded an Environment, Science and Governance Score (RS) of '5' for both Political Stability and Rights and for the Rule of Law, Institutional and Regulatory Quality and Control of Corruption.
These scores, Fitch said, reflect the high weight that the World Bank Governance Indicators (WBGI) have in its proprietary Sovereign Rating Model. Ghana has a medium WBGI ranking at 50.8 reflecting a recent track record of peaceful political transitions, a moderate level of rights for participation in the political process, moderate institutional capacity, established rule of law and a moderate level of corruption.
Again Ghana scored an ESG Relevance Score (RS) of '5' for Creditor Rights as willingness to service and repay debt is highly relevant to the rating and is a key rating driver with a high weight. The highest relevant score is 3.
It concluded that the rating on Ghana's LTFC IDR reflects Fitch's view that Ghana is in default.
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