African Rating Agencies
Agusto & Co.
Agusto & Co., a Nigerian credit rating agency with offices in Nigeria, Kenya, Rwanda, and Ghana, do generate sovereign credit ratings but a. do not reveal the methodology publicly, and b. have only one recognised Sovereign & Supranational rating on their website, which is for the African Finance Corporation.
Bloomfield Investment Corporation
Bloomfield Investment Corporation provides ratings for African entities, and also sovereign ratings. Its methodology is publicly available (in French only). The structure of the sovereign methodology and its contents are almost identical to the big three methodologies and include a focus on:
Political and Social Environment
This includes: Social Structures, and Political Environment
Macroeconomic Analysis
This includes: Economic Performance, and Coherence of the Economic Policy Implemented
Public Finances
This includes: Estimation of Public Debt, Debt Weight, and State Budget
Monetary Institutions and Policy
External Situation
This includes: External Debt, External Assets, and External Financing Policy.
How the above is weighted against each other to come to an overall rating is not declared, nor are there any indications as to likely sources of information for any of the determinants.
GCR Ratings
GCR Ratings is the largest rating agency on the African Continent. It was purchased by Moody’s in 2022 and provides almost three times more ratings than its nearest coverage competitor, S&P. GCR does not provide sovereign ratings, but instead generates ‘sovereign risk’ scores that it injects into its corporate ratings.
To determine this Country Risk Score, GCR apply the following metrics/categories:
The Structural Country Risk Score
Which includes ‘Economic Strength’, which takes into account metrics such as GDP per Capita.
Idiosyncratic Stress & Sovereign Risks or Strengths
Which includes ‘Fiscal’, ‘Geopolitical’, ‘External Position’, ‘Monetary Policy’ and ‘Size and Diversification’.
Sovereign Africa Ratings
Sovereign Africa Ratings is a domestic Credit Rating Agency situated in South Africa. A relatively new player to the field, the small agency does publish its methodology. The sovereign methodology of Sovereign Africa Ratings is based on five (5) particular pillars. They are:
Economic Strength
This includes aspects such as GDP Growth and Relative Size, and the Structure
Financial Strength
This includes aspects such as the debt profile and the local currency/financial markets
Institutional Strength
This includes aspects such as Institutional Effectiveness
ESG
Natural Resources
This includes aspects such as Extraction and Beneficiation.