'African risk premium': AU launches own credit rating agency [Business Africa]

'African risk premium': AU launches own credit rating agency

A sovereign credit rating is more than a number. It shapes how investors judge whether a government can and will repay its debts, and it decides what countries pay to borrow.

A negative rating means expensive debt or worse.

For African countries, the “African risk premium” has turned perception into a multibillion-dollar bill, often because risk is assessed with too little local knowledge.

The UN says African countries face some of the world’s highest borrowing costs, with ratings driving up interest and cutting off access to international capital.

Now the African Union is fighting back with its own credit rating agency.

Dr Misheck Mutize, the AU’s advisor on credit rating agencies, played a key role in efforts to create the Africa Credit Rating Agency (AfCRA).

He joins the show to explain its mandate, and why African economies must be judged on facts, not assumptions.

Senegal’s homegrown satellites

Africa’s space ambitions are taking off. National space budgets have climbed to $800 million, up from less than $300 million in 2018.

Better satellite data is becoming essential for urban planning and environmental monitoring, especially as cities swell and farmers face an increasingly unpredictable climate.

After partnering with France to build and launch its satellites, Senegal has finalized plans to assemble future satellites at home, at the headquarters of its national space program just outside Dakar.

The informal sector: Africa’s economic engine, yet underperforming

Africa’s informal sector is both a burden and a lifeline. It is barely regulated, barely protected, and contributes little to tax revenue.

Yet it is the backbone of the continent’s economy, employing more than 80% of Africa’s workers. The informal sector already powers GDP.

The real question is how to unlock its full potential.