He said the conclusions by the international rating agencies affected the prospects of African countries raising the required external financial resources on the capital market to promote economic expansion on the scale European economies did in the 1950s and 1960s.

Speaking in Accra on Tuesday at the opening of an African Peer Review Mechanism (APRM) Sensitisation Meeting on International Credit Ratings to discuss the challenges of CRAs and how to resolve them, Mr Ofori-Atta said the unfair ratings affected developing countries’ access to credit.

“Global Credit Rating Agencies (CRAs) have become critical gatekeepers to an important source of development finance. An unfavourable credit rating, or a negative rating outlook, has, therefore, the potential to impede growth and undermine economic stability,” Mr Ofori-Atta, said.

“While we respect the important role the CRAs play in the allocation of capital, the CRAs must also be mindful of the critical impact they have on access to international capital,” he emphasised.

The Finance Minister sovereign credit ratings on the continent had been persistently low since 1994 when South Africa received the continent’s first credit rating.

He said African sovereigns were significantly less likely to be promoted from B into the BB category, compared to other regions, even after accounting for improvements in the macro-fiscal environment and the willingness of African governments to service debts.

 For instance, he said between 1949 and 2021, Standard and Poor’s had graded African countries low compared to other regions.

 Mr Ofori-Atta said only 1.1 per cent of African Sovereigns rated in the ‘B’ category (which form the majority of rated African Sovereigns, were upgraded to BB).

Since the start of the COVID-19 pandemic, he said, 21 African Sovereigns had been downgraded, while only two had been upgraded.

Quoting the United Nations Economic Commission for Africa, he said Low-income African countries would need $245 billion in additional financing by 2030, while the whole of sub-Saharan Africa would need $425 billion to address the socio-economic impact of the pandemic and support economic recovery.

“The pertinent question remains, how will we mobilise such resources when our economies are written off in financial markets as “riskier” thanks to a rating methodology that has been in dire need of reform since the financial crisis of 2009,” he asked.

Mr Ofori-Atta said since 2003 to date, Ghana had three upgrades and nine downgrades and though between 2017 and 2019, the country had successive rating upgrades, with a “track-record” of safeguarding macroeconomic stability, it was questionable that the country was downgraded during a pandemic

 “Unless we prioritise reform now, the divergence between developed and developing nations will become a toxic recipe for instability, crisis, and forced migration,” he said.