Mauritius is preparing to open an African rating agency
The African Union has announced that the African rating agency AfCRA will officially begin its work on October 7 in Mauritius. The agency's headquarters will be located in Port Louis. Other countries may apply for additional offices.
AfCRA is expected to provide sovereign and corporate credit ratings designed to better reflect economic conditions in Africa, as the methodologies and estimates used by Fitch, Moody's and S&P overestimate the risks to the continent, leading to higher borrowing costs.
AfCRA is also designed to address weaknesses in Africa's financial information ecosystem. Thus, the African rating agency may turn out to be not so much a direct competitor to Fitch, Moody's and S&P, as a catalyst for increasing transparency and quality of financial information.
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