An American credit rating agency, S&P pushed Ghana's debt further into speculative territory, lowering its foreign and local currency sovereign ratings to CCC+/C from B-/B.
S&P's downgrade of Ghana's economy disappointing – Gov't
The Finance Ministry has expressed disappointment in the rating firm Standard and Poor's (S&P) Global Ratings for its downgrading of the Ghanaian economy.
S&P in its outlook for the country recorded negative and said "reflecting Ghana's limited commercial financing options, and constrained external and fiscal buffers."
A report by MarketWatch stated that the COVID-19 pandemic and the conflict in Russia have magnified Ghana's fiscal and external imbalances.
It said demand for foreign currency has been driven higher by several factors, including nonresident outflows from domestic government bond markets, dividend payments to foreign investors, and higher costs for refined petroleum products.
The agency indicated that Ghana has also been affected by a lack of access to Eurobond markets.
"While these changes could improve the tax take going forward, the situation remains challenging, and over the first half of 2022, the fiscal deficit has exceeded the government's ambitious target," S&P added.
S&P had also affirmed Ghana's ratings in February, as Moody's downgraded the African nation to Caa1 with a stable outlook.
But the Ministry said the economy is struggling as a result of the impact dealt it by the global COVID-19 pandemic.
The Ministry in a statement failed to acknowledge the measures being taken by the government to put the economy back on track.
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