Ghana?s Finance Minister ?Mr Seth Terkper said credit rating companies lowered the nation?s debt assessment to boost their own credibility.
?I don?t believe in a downgrade,? Terkper said in an interview on January 17, ?in?Accra. ?The rating agencies, they had their own problems, so they want to be seen as tough.?
Fitch Ratings?in October cut Ghana?s credit assessment one level to B, five levels below investment grade, as the government failed to achieve its fiscal-deficit goal of nine ?per cent of gross domestic product and overran on its spending on interest payments.
Standard & Poor?s?and Moody?s Investors Service last month lowered the outlook on their ratings to negative from stable, indicating a greater chance of a downgrade than an improvement in the rating.
Mr Terkper told lawmakers in a budget speech two months ago that the fiscal gap will narrow to 8.5 per cent of GDP this year from an estimated 10.2 per cent in 2013.
The world?s second-largest cocoa producer is planning to sell more longer-term debt to reduce its borrowing costs as it seeks funding to pay salaries and plug the deficit. It also wants to attract more foreign investors by increasing the issuance of medium- to long-term bonds.
?It?s difficult because we are in transition from a developing to a middle-income country,? Terkper said. ?That means that you have less access to concessional financing? from the?World Bank.
The cedi dropped one per cent to 2.41 per dollar, extending the year?s decline to 1.5 per cent. The yield on the dollar bond due 2023 rose one ?basis point, or 0.01 percentage point, to 8.6 per cent.
Source Bloomberg
