The African Union on Wednesday launched the Africa Credit Rating Agency (AfCRA) in Port Louis, Mauritius, giving African governments and companies a homegrown alternative to Moody’s, S&P Global, and Fitch Ratings at a time of high borrowing costs and heavy debt-service obligations, according to a statement from the African Union Commission.
The agency, headquartered in the Mauritian capital, will assess sovereigns, sub-sovereign borrowers, and corporates, with an initial emphasis on local-currency debt. Mahmoud Ali Youssouf, chairperson of the AU Commission, attended the ceremony, which was held alongside the second annual African Conference on Credit Ratings.
Mauritius was selected as host after African countries were invited to submit proposals. Youssouf told the ceremony that the choice was not accidental, pointing to the island’s financial sector, international connectivity, and its status as a recognised financial hub.
Officials were careful to present AfCRA as a complement to the established agencies rather than a rival. It is not intended to replace them, shield borrowers from scrutiny, or guarantee favorable ratings, the AU said. Instead, it will bring African data and expertise into the assessment process and widen coverage. Twenty-three African economies currently carry no rating from any of the three global agencies.
Marie-Antoinette Rose Quatre, chief executive of the African Peer Review Mechanism (APRM), the AU body that oversaw the set-up, called the launch “a big statement by the continent” that it is ready to manage its affairs to an international standard.
AfCRA now operates autonomously of the APRM and is structured as a private-sector-led institution. Plus94, a South African research and analytics firm, supported its technical establishment. Its management may also rate non-African entities.
The grievance behind the project is long-standing. African governments argue that the big three overstate risk, downgrade quickly during shocks such as conflicts and pandemics, and add a premium to the cost of capital raised in international markets.
Ghana and Zambia have both said that downgrades deepened their debt difficulties. More recently, the APRM criticised Fitch’s downgrade of the African Export-Import Bank (Afreximbank), saying the agency had not adequately assessed the lender’s fundamentals.
Denys Denya, an executive vice-president at Afreximbank, told the launch that gaps in understanding lead lenders to charge more.
The AU has tied the agency to its wider aim of deepening domestic financial markets. Part of its mandate is to broaden access to credible credit opinions, support access to capital, and bring more African issuers into open capital markets.
Political backing has been considerable. Nigerian President Bola Tinubu argued in a Financial Times opinion article earlier this year that African economies are heavily exposed to the judgements of the big three, which may not reflect conditions on the ground. Ahead of the launch, he added that AfCRA must earn investors’ confidence through independence, credibility, and rigorous assessments.
The idea is older than any of those interventions. Senegal’s then president, Macky Sall, pressed for a new system in 2022 while chairing the AU. The AU Assembly endorsed an African agency in 2018, and leaders adopted a supporting declaration in Nairobi in July 2023. The launch itself was first pencilled in for June 2025, then September 2025, before slipping by another year.
AfCRA has yet to publish a rating. Earlier timetables pointed to a first sovereign rating between late 2025 and early 2026, and later to mid-2026; neither held. The agency was due to set out its methodology, rating scale, and timetable for first assessments on Thursday. Those documents will count for far more with global investors than the ceremony itself did.
The agency enters a market in which global groups have been expanding their African presence. Moody’s bought South Africa’s GCR Ratings in July 2024. Two regional firms, Bloomfield Investment Corporation in Côte d’Ivoire and Agusto & Co. in Nigeria, already operate on the continent, the latter since 1999.
Rating agencies build their standing over years, and AfCRA has no track record yet. Observers expect it to supplement rather than displace the big three in the near term, since international investors will want to see how its grades behave through a full credit cycle.
Analysts say credibility will rest on four things: independent rating committees, firm conflict-of-interest rules, transparent criteria, and a record of stable, predictive ratings. Ratings considered issuer-friendly would be discounted by investors, and a body created by governments faces a harder test than most in demonstrating that it is not beholden to them.
Supporters point to the local-currency focus as the sharper argument. Methodologies built around hard-currency debt, they say, tend to miss the depth and behavior of domestic markets, where many African borrowers raise a growing share of their funding.
They argue that improved coverage and context could bridge the gap between the continent’s ratings and its actual performance. No one involved claims it will cut borrowing costs overnight.
The launch also sits within a wider push for common action on debt. Paul Sikazwe, the AU Commission’s technical adviser on debt, has said an African Monetary Institute is due to be inaugurated in Abuja in late October, intended as a precursor to a regional central bank.
Image Courtesy: African Union