Moody's rates Ghana bond B1

Moody's Investors Service said it assigned a B1 rating to the Government of Ghana's $750 million global bond due in 2023.

This rating is on par with the sovereign's B1 long-term foreign-currency issuer rating, which has a stable outlook.

Although Ghana's robust economic outlook is supportive of the rating, Moody's said its weak government financial strength and external vulnerabilities continue to constrain the sovereign rating at the B1 level.

In particular, the agency said, sub-par fiscal management has resulted in large fiscal deficits, which peaked at 11.9% of GDP in 2012, driven by: (a) elevated expenditure commitments in the run-up to the presidential election last December; (b) increases in public-sector wages and energy subsidies; (c) the clearance of arrears; and (d) high and rising debt-servicing costs.

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