President Nana Addo Dankwa Akufo-Addo says various rating agencies are partly responsible for the country’s economic crisis.
Delivering a speech during the celebration of the 30th anniversary of the African Export-Import Bank in Accra, the president lamented the excessive pressure to which rating agencies subjected the country through their “reckless downgrades.”
This, he indicated shut Ghana out of the capital market.
According to him, such ratings do not play in the best interest of the country.
“The AU champion for African financial institutions and leader of a country that recently had to deal with one of the most difficult periods in his post-independent history, difficulties that were exacerbated by the reckless behavior of rating agencies that engaged in pro-cyclical downgrades that shut Ghana out of the capital market and turned a liquidity crisis into a solvency crisis,” he expressed.
However, the president has called for more integrated efforts within Africa in a bid to stop depending on foreign capital markets.
The president said Africa needs its own financial market in order to ensure domestic growth through resource mobilization and to be able to develop its private sector.
He noted that disadvantages emanating from the dependency on foreign financial institutions include financial leakages, high borrowing, and interest payments.
“Unless we have strong financial institutions, we are not going to develop. We have learned over the decades that relying on foreign capital is both risky and costly. It has resulted in huge financial leakages to a high cost of default-driven borrowing rates and interest payments and undermines the growth of our financial institution’s domestic resource mobilization and private sector development,” he added.
Meanwhile, some experts are appalled by the president’s blaming of rating agencies. Some have indicated that in case the president is not pleased with the ratings, he should form his own agencies to that effect.
Founding President and Chief Executive Officer of IMANI Centre for Policy and Education, Franklin Cudjoe responded to the president’s comment through a Twitter post.