Keypoints:
- AfCRA to begin operations by Sept 2025
- Agency pledges independence from governments
- Aim is to challenge global rating bias
A NEW Africa-led credit rating agency, the African Credit Rating Agency (AfCRA), will begin operations by the end of September 2025, marking a bold continental response to long-standing dissatisfaction with global ratings giants Fitch, Moody’s, and S&P.
Set up under the auspices of the African Union’s African Peer Review Mechanism (APRM), AfCRA is expected to issue its first sovereign credit rating by late 2025 or early 2026, according to Misheck Mutize, APRM’s lead expert on rating agencies.
Speaking to reporters, Mutize confirmed that the search for a Chief Executive Officer is in its final stages, with a shortlist already drawn and an appointment expected in the third quarter of 2025.
Pushback against global rating bias
The launch of AfCRA is widely viewed as Africa
’s structural response to what policymakers have described as years of misrepresentation and punitive ratings from international agencies.
Countries like Ghana and Zambia have publicly criticised repeated downgrades that, they argue, inflated their borrowing costs and triggered avoidable defaults. A recent flashpoint came when Fitch Ratings downgraded the African Export-Import Bank (Afreximbank), a move sharply rebuked by the APRM, which described the decision as legally flawed and analytically unsound.
Fitch has defended its methodology, maintaining that its decisions follow consistent global standards. But African institutions increasingly argue that such standards fail to account for local financial structures, sovereign relationships, and development mandates.
Private-sector led, politically independent
Mutize stressed that AfCRA’s governance will be fully independent of political influence.
‘This was designed to maintain independence and avoid conflict of interest. Shareholding will mainly be African private-sector driven entities,’ he said, pushing back against any perception that the agency might serve as a political tool.
Un
like the major Western agencies, AfCRA plans to focus on local-currency debt ratings, aiming to reduce Africa’s dependency on foreign-denominated borrowing and boost domestic capital market growth.
Importantly, Mutize added that AfCRA will not act as a cheerleader for African governments: ‘It is important to debunk the assumption that AfCRA is being established to give favourable ratings to Africa—no. We will issue downgrades where necessary.’
Global inequality in borrowing costs
The launch comes amid growing criticism of the financial burden African countries face in global credit markets. According to the United Nations Economic Commission for Africa (ECA), biased ratings by agencies headquartered outside the continent have contributed to inflated borrowing costs.
In a statement issued on June 6, ECA Executive Secretary Claver Gatete pointed to the stark disparity in debt servicing costs: ‘Germany can borrow $1bn at 2.29 percent, paying around $229mn in interest over 10 years. In contrast, Zambia may pay up to $2.25bn over the same period for the same amount.’
Gatete warned that these imbalances are fuelled by sub-investment grade or ‘junk’ ratings that fail to reflect Africa’s real economic trajectory. Critics argue that many global credit evaluations ignore local socio-economic factors, misread political contexts, and rely heavily on external benchmarks.
Towards fairer financial assessments
By establishing AfCRA, the African Union aims to assert greater control over how African economies are assessed, reduce reliance on external metrics, and foster a more accurate, context-sensitive ratings landscape.
The new agency will join a small but growing group of emerging-market-led institutions seeking to reform the global financial system from within. Whether AfCRA will be able to compete with the legacy and scale of the global ‘big three’ remains to be seen—but its arrival sends a strong signal that Africa is no longer willing to be merely the subject of credit decisions made elsewhere.
