Fitch downgrades Ghana

Fitch Ratings said it downgraded Ghana's long-term local- and foreign-currency issuer default ratings to CC from CCC. The agency usually does not assign outlooks to issuers with a CCC rating or below.

“The downgrade reflects the increased likelihood that Ghana will pursue a debt restructuring given mounting financing stress, with surging interest costs on domestic debt and a prolonged lack of access to Eurobond markets. There is a high likelihood that the IMF support program currently being negotiated will require some form of debt treatment due to the climbing interest costs and structurally low revenue as a percentage of GDP.

“We believe this will be in the form of a debt exchange and will qualify as a distressed debt exchange under our criteria. The government has not confirmed or denied press reports that Ghana is preparing to negotiate a restructuring,” Fitch said in a press release.

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