- Fitch, an international rating agency, has ranked Ghana's economy at 'B'
- It expressed hopes of a swift recovery of the economy after the elimination of the coronavirus
- Fitch added that the anticipated recovery comes at a time when there is also the risk of a deeper and longer economic shock
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International rating agency, Fitch, has affirmed Ghana’s Long-Term Foreign-Currency Issuer Default Rating (IDR) at ‘B’.
With the rating, the agency expressed hope in the possibility of a swift recovery of the economy after the COVID-19 epidemic.
It also highlighted the importance of additional fiscal and external financing options for the country.
READ ALSO: COVID-19: Akufo-Addo predicts Ghana's economic growth could fall from 7% to 2.5%
The hope for recovery comes at a time when there is also the risk of a deeper and longer economic shock that could lead to worsened fiscal and external debt metrics.
A dailymailgh.com report shows that the outbreak of the coronavirus is likely to cause a shock to Ghana’s near-term growth and fiscal outturns.
It is also expected to upset Ghana’s public finances given the country’s track record of fiscal slippage in election years as well as deficiencies in public financial management (PFM) that weakened the government’s ability to meet fiscal targets.
Fitch has predicted that general government cash deficits would widen from 7.6% of GDP in 2019 to above 10% in 2020.
This is expected to include approximately 2.8% of GDP in arrears clearance and the realisation of contingent liabilities from the financial and energy sectors.
It is also expected that the fiscal deficit will narrow in 2021, supported by stronger growth and fewer materialising contingent liabilities.
YEN.com.gh earlier reported that Moody’s, an international rating agency, downgraded Ghana’s economic outlook from positive to negative.
The firm, however, maintained the country’s long-term local and foreign currency issuer and foreign currency senior unsecured bond ratings at B3.
Information available shows that the outbreak of the coronavirus is a key reason for the downgrade. Read more:
READ ALSO: Fitch predicts COVID-19 could lead to a slowdown in Ghana's power sector
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