President Bola Ahmed Tinubu backs the newly established African Credit Rating Agency (AfCRA), emphasizing its role in providing fair and transparent assessments of African economies. The African Union (AU) launches AfCRA to address concerns over biases from global credit rating agencies......CONTINUE READING THE ARTICLE FROM THE SOURCE>>>>>
Tinubu commends the AU, the African Development Bank (AfDB), and the Specialized Technical Committee on Finance for their leadership in creating an African-led credit rating system. He highlights that this initiative will ensure more accurate evaluations of African economies, reducing the disadvantages they face in international financial markets.
Tackling Africa’s Financial Challenges
Tinubu stresses the importance of the Africa Financing Stability Mechanism (AFSM) in addressing key economic issues such as high borrowing costs, debt burdens, low domestic revenue, and limited access to long-term financing. He explains that the AFSM strengthens financial stability and resilience, helping African nations achieve their development goals.
“The adoption of this mechanism demonstrates Africa’s commitment to financial stability and a more coordinated approach to managing economic risks,” Tinubu states, referencing key agreements reached at the 5th Extraordinary Session of the Specialized Technical Committee on Finance in Abuja in November 2025.
Strengthening Africa’s Financial Independence
Kenyan President William Ruto introduces AfCRA at an AU event in Addis Ababa, Ethiopia, reaffirming the need for a fair and Africa-centered credit assessment system. Ruto criticizes global rating agencies for unfairly penalizing African economies, leading to higher borrowing costs and lost investment opportunities. A report by the Africa Peer Review Mechanism and the United Nations Development Programme estimates that biased credit ratings have cost Africa approximately $75 billion.
For years, the AU has voiced concerns about the impact of global rating agencies such as Moody’s, Fitch, and S&P, which are often accused of unfairly assessing African economies. In January, the AU pointed out inconsistencies in Moody’s ratings of Kenya’s economic outlook, strengthening the case for an independent African credit rating agency.
With AfCRA now operational, African nations move toward greater financial sovereignty, ensuring that credit assessments reflect the true economic potential of the continent rather than external biases.