CAIRO, Oct 1 – The African Development Bank (AfDB) plans to launch an initiative aimed at helping African countries better prepare for sovereign credit ratings, as the continent seeks to address high borrowing costs and improve access to international capital.
AfDB President Sidi Ould Tah announced the initiative at the S&P emerging markets conference in London, arguing that weaknesses in economic data and market infrastructure can contribute to perceptions of elevated risk across African economies. Reuters reported the announcement on Thursday.
“What is missed in Africa is the data and the infrastructure…the opacity in some markets creates this notion of high risk, which leads to high cost of borrowing,” Tah said.
The initiative will be implemented through the African Legal Support Facility (ALSF), an institution hosted by the AfDB that provides African governments with legal, technical and capacity-building support, including in sovereign debt matters.
According to Tah, the programme will help governments strengthen the quality of information available to credit-rating agencies and improve transparency around their economies and public finances.
Addressing Africa’s Borrowing Costs
African policymakers have increasingly raised concerns about the cost of sovereign borrowing and the factors influencing how international investors assess African debt.
Tah said improving credit ratings is a shared objective across the continent, noting that only three of Africa’s 54 countries are currently investment grade, according to the Reuters report.
The initiative comes as the AfDB expands its broader efforts to strengthen Africa’s financial architecture and mobilise more domestic capital. The bank’s 2026 strategy places greater emphasis on unlocking African capital and strengthening financial systems, while its New African Financial Architecture for Development seeks to mobilise domestic savings for productive investment.
The African Peer Review Mechanism, an African Union-backed institution, is also preparing to launch a continent-wide credit-rating agency, with the objective of providing an additional African perspective on sovereign credit assessments.
Mobilising Domestic Capital
The AfDB is simultaneously working to expand the role of domestic investors in financing African development.
Tah said the bank has engaged pension funds, banks and other financial-market stakeholders to identify barriers to deeper capital markets and stronger domestic resource mobilisation.
The effort is consistent with the AfDB’s broader push to channel African institutional savings into infrastructure and other productive investments. In July, the bank strengthened its partnership with the African Sovereign Wealth Fund Forum to mobilise institutional capital for cross-border infrastructure projects.
For African governments, stronger economic data, more transparent public finances and deeper domestic capital markets could provide additional channels for financing development while reducing dependence on external borrowing.
