Africa-Led Credit Rating Agency Set to Launch by September 2025 as Continent Pushes Back Against Global Bias

Africa is evolving to take control of its story in Global Finance, because a new agency for the rating of continental credit should begin operations by September 2025.

Known as African Credit Rating Agency (AFCRA), the initiative aims to challenge what African leaders and economists consider a systemic bias by the most global rating companies – Moody’s, S&P and Fitch.

The agency supported by the African Syndicate is being developed within the framework of the African Peer Examination Mechanism (APRM) and will publish its first sovereign credit rating between the end of 2025 and the beginning of 2026, according to Misheck Mutise, chief expert in the APRM credit rating agencies. Currently, the AFCRA finalizes the selection of its first CEO, with an appointment scheduled before the end of the third quarter of 2025.

A response to decades of criticism

The launch of AFCRA marks an important policy and economic stage, based on long -standing frustration of the way in which global rating companies assess African economies. Countries such as Ghana, Zambia and Nigeria have frequently criticized these companies for downgrades which, according to them, are based on erroneous hypotheses, exteriorized perceptions and an inadequate understanding of the unique risks and opportunities of the continent.

In the case of Zambia, which was lacking on its Euro-objects payments in 2020, officials partially blamed international demances for having triggered a self-fulfilling debt spiral that frightened investors and an increase in borrowing costs. Likewise, Ghana, which was lacking in 2022, argued that pessimistic assessments feed speculation and restrict access to credit long before countries faced a budget collapse.

In a more recent example, the African Peer Review mechanism directly challenged the Fitch ratings for its Republic of African Bank of important exports (Afreximbank). The APRM accused Fitch of a bad analysis and a “misunderstanding of African institutions”. Fitch replied by defending his methodology as being generally coherent and transparent.

Safeguard of independence

Unlike the main international rating agencies – often accused of being shaped by geopolitical interests – AFCRA will not belong to the State, Mutize said.

“This has been designed to maintain independence and avoid conflicts of interest. Participation will mainly be African entities focused on the private sector, “he said.

The AFCRA governance structure aims to protect the agency from political interference while making its operations more transparent and more informed locally. Above all, it aims to be objective and credible, Mutize stressing that the AFCRA is not designed to provide swollen scores.

“It is important to demystify the hypothesis that AFCRA is established to give notes favorable to Africa. No. We issue difts if necessary,” he said.

Focus on local currency

A key characteristic of the AFCRA will be the emphasis on the notations of the local debt, a change which could have important implications for the financial sovereignty of Africa. AFCRA hopes to strengthen internal capital markets and reduce excessive exceeding of costly loans on a foreign level, which exposes savings to exchange rate shocks and reimbursement risks, by prioritizing local currency assessments.

This approach combines with the growing call among African financial institutions to relax debt and exploit local economies, pension funds and regional capital pools for long -term infrastructure and development of development.

UN and ECA Back Africa’s push

The agency is also launched with a strong support from global institutions such as the United Nations Economic Commission for Africa (ECA). Claver Gatete, executive secretary of ECA, recently criticized the current landscape of credit rating, saying that African nations are struggling with disproportionately high borrowing costs due to the coherent “undesirable” note by dominant agencies.

Gatete underlined the disparity in real terms: while Germany can borrow $ 1 billion at an interest rate of 2.29% – moving to approximately $ 229 million over a decade – Zambia, under current credit conditions, would pay up to $ 2.25 billion in interest for the same amount, almost ten times more.

He warned that credit ratings continue to be shaped by external prejudices and often fail to incorporate a nuanced understanding of African political economies.

According to Gatete, most of the main rating agencies have their registered office outside Africa and often assess the continent through an external lens.

Many believe that these “external” evaluations ignore internal structural reforms, do not recognize regional resilience and, ultimately, make it more expensive for African countries to access the capital they need to develop.

A first of its kind

While the idea of ​​a credit rating agency led by Africa has circulated for years, the AFCRA is the first effort of this type ready to become operational, with institutional support, an involvement of the private sector and a clearly stated regulatory program. What distinguishes it is not only its continental scope, but the fact that it will actively assess the sovereign risk with a mandate rooted in equity, transparency and context.

Although various African governments and financial institutions have expressed concerns concerning the rating in the past, this marks the first time that a coordinated response of this scale materializes – which can also indirectly shape the standards and expectations of international agencies operating on the continent.