The Africa Credit Rating Agency (AfCRA) has opened discussions with 15 African governments as it prepares to issue its first sovereign credit ratings by the end of March 2027.
The engagement marks a major step towards the commencement of operations of the continent’s new credit rating institution, which seeks to provide additional assessments of African economies and broaden the information available to investors on sovereign credit risks.
Interim Chief Executive Officer of AfCRA, Sifiso Falala, disclosed that the agency was negotiating with 15 sovereign borrowers, with research expected to cover countries including Togo, Kenya, Seychelles, Burundi and Mauritius.
According to Falala, the agency plans to publish its initial sovereign credit assessments before the end of the first quarter of 2027.
AfCRA, which was officially launched in Mauritius on October 7, 2026, was established following an African Union initiative aimed at strengthening the continent’s financial architecture and addressing concerns about the assessment of African economies by international credit rating agencies.
The agency is expected to provide an additional perspective on the creditworthiness of African countries, particularly in response to longstanding complaints by some African governments that international rating agencies do not adequately reflect the economic conditions, institutional developments and growth prospects of countries across the continent.
However, AfCRA’s emergence is not intended to replace established international rating agencies but to introduce another source of independent credit analysis into the market.
The agency will initially focus on sovereign ratings before extending its activities to multilateral financial institutions and private-sector companies.
Under its proposed operating model, governments seeking ratings will pay for the assessments and provide access to relevant government officials, economic information and financial data required for the evaluation process.
The agency’s ability to obtain reliable information and maintain analytical independence is expected to be critical to establishing confidence among investors, financial institutions and international capital market participants.
Africa’s high borrowing costs remain a major concern for policymakers, particularly as governments continue to contend with rising debt-service obligations and limited fiscal space for infrastructure and social-sector investments.
Falala estimated that African countries collectively incur an additional $75bn annually in interest payments, reflecting what the agency considers an excessive risk premium attached to borrowing across the continent.
Africa’s total debt is estimated at approximately $1.9tn, highlighting the scale of financing obligations facing governments and the importance of credible credit assessments in determining borrowing costs and access to international capital markets.
Credit ratings influence how investors assess the ability of governments and companies to meet their financial obligations.
They also affect the interest rates borrowers pay when raising funds through international bonds, loans and other debt instruments.
A country’s rating can therefore influence its ability to attract foreign investment, access international financial markets and finance development projects.
AfCRA’s establishment is expected to broaden the range of credit information available to investors by incorporating more country-specific economic data, local market conditions and institutional developments into its assessments.
The agency is owned by South African research firm Plus 94 Research and is seeking to raise $15m through a share sale that would give African investors a two-thirds ownership stake.
It has also acquired a 51 per cent interest in Sovereign Africa Ratings as part of efforts to strengthen its operational and research capabilities.
The success of the new institution, however, will depend largely on its ability to demonstrate independence, transparency and consistency in its rating decisions.
Investors will also assess whether its methodologies meet internationally accepted standards and whether its assessments can withstand scrutiny, particularly when economic conditions deteriorate or when its conclusions are unfavourable to governments seeking ratings.
The African Union and other stakeholders have consistently maintained that the agency should complement existing rating institutions by providing additional analysis of African economies rather than issuing favourable assessments simply because the borrowers are African.
With discussions underway with 15 sovereign borrowers, the next major test for AfCRA will be translating its engagements into completed rating mandates and delivering its first assessments within the March 2027 timeline.
