The Chief Executive of the new Africa Credit Rating Agency (AfCRA), Dr. Sifiso Falala, says that AfCRA is operational and ready to work with governments and businesses seeking credit assessments.
Speaking on the sidelines of the inauguration, Falala said that the agency had put economic data parameters online and established research and analytical teams to support its work.
“As we launch the agency, we are fully prepared to do business with the entities that might be interested in getting us to do business with them.
“We have a research team that is capable of collating data at an international level for various countries; we have an analytical team that has expertise in analysing such data and translating that into insights that can inform our outputs.
“We will eventually, of course, produce rating certificates, reports, and recommendations,” he said.
Sovereign ratings will be AFCRA’s initial priority, Falala said, because governments’ economic conditions affect the operating environment for businesses.
He noted that the biggest problem for Africa rested with the sovereigns, because they were the pivot for the commercial side.
He added that commercial entities could struggle to succeed when sovereigns were economically weak or faced extensive debt-servicing costs.
Falala added that, while sovereigns were the immediate focus, AfCRA also intended to engage with commercial clients.
For African nationals, the agency’s potential value would lie in contributing to a fuller, evidence-based picture of African economies and businesses.
More contextual analysis could give governments, investors and companies another source of information when assessing risks and opportunities.
Such analysis may support better-informed decisions, although AfCRA’s ratings alone cannot guarantee investment, economic growth or improved living standards.
Local media reports quoted Falala as saying that the agency was established to address gaps in data and research affecting the continent.
He described the challenge as one shared across Africa’s 55 nations, saying: “It’s a data problem. It’s a research problem.”
He stated that AfCRA hopes its research will help unlock value within African states and that the agency’s approach will combine desk-based analysis with field research.
The Africa Credit Rating Agency has a mandate to provide an alternative to a field dominated by the big three Western global ratings agencies.
The African Union (AU) appointed South African Falala as interim chief executive officer of the AfCRA, as the continent moves to establish a privately owned credit rating institution focused on African markets.
AfCRA was formally launched in Port Louis, Mauritius, where it will be headquartered, following years of discussions over the creation of an African credit rating institution.
GIK/APA