The Ministry of Finance has expressed disquiet about the recent downgrade of Ghana’s credit rating from B to B-negative by the international ratings agency, S&P Global.
In a Press release issued on Tuesday, September, 14,2020, by the Finance Ministry said that the Covid-19 pandemic related expenditures had elevated the fiscal policy stance due to the government’s decision to shore up the lives of ordinary citizens through temporary life-saving initiatives and interventions aimed at protecting the general population against the economic shocks created by the Covid-19.
“This was the fundamental reason for the lowering of the rating,” the statement said.
It thus said it found it disturbing that rating agencies would choose that path at a time when countries, including Ghana, were battling an unprecedented crisis.
The Finance Ministry reiterated that the rating is ill-timed, urging S&P and other rating agencies alike to consider freezing any rating actions during global pandemics such as Covid-19.
It said a review of global credit ratings indicated that Ghana was not the only country to suffer a lowering of sovereign credit ratings, noting that more than 80 countries had been affected, with negative outlook revisions for the year being more than 100.
Most of these credit rating downgrades and negative outlook revisions are heavily concentrated on the countries who previously were at B/B2 credit ratings,” it said.
“These adverse rating actions have touched almost all continents, as rating agencies react to the effects of the pandemic on the global economy,” it said.
Meanwhile, the statement indicated that it expects the economy to rebound swiftly and all one-off expenditures eliminated with the gradual easing of the restrictions.
“We have a clear path towards the restoration of economic stability in the short to medium term,” the statement said.