The United Nations Economic Commission for Africa (ECA), in partnership with the African Peer Review Mechanism (APRM), has released the 12th edition of the Africa Sovereign Credit Rating Outlook, highlighting a wave of sovereign credit rating upgrades across the continent during the second half of 2025.
The report finds that several African countries recorded improved credit assessments as a result of stronger macroeconomic performance, tighter fiscal discipline, and tangible progress in debt restructuring efforts, despite a challenging global financial environment marked by high interest rates and tighter liquidity conditions.
According to the Outlook, the latter half of 2025 marked a turning point for Africa’s sovereign credit landscape, with international rating agencies responding positively to reform momentum in a number of economies.
Countries that benefitted from upgrades include Côte d’Ivoire, Ghana, Egypt, Kenya, Morocco, Seychelles, South Africa, Tunisia and Zambia.
Côte d’Ivoire was cited as a notable example, receiving an upgrade from Fitch Ratings on the back of sustained economic growth above six per cent, relative political stability, and proactive debt management measures.
These included Eurobond buybacks and diversification of funding sources through instruments such as Samurai bonds, which helped reduce refinancing risks and improve debt sustainability.
The report provides a detailed review of rating actions taken by Moody’s, Standard & Poor’s (S&P) and Fitch Ratings across African economies, examining how fiscal pressures, governance reforms and global financial conditions shaped sovereign credit outcomes over the year.
It also compares how rating methodologies are applied in Africa relative to other regions, raising concerns about consistency and structural bias.
While many countries saw positive rating actions, the Outlook notes that credit developments across the continent remained mixed. Botswana, for instance, experienced downgrades by both Moody’s and S&P following a sharp decline in diamond revenues, which weakened fiscal balances and exposed vulnerabilities linked to limited economic diversification.
Despite the downgrades, Botswana retained its investment-grade status.
Other countries that faced rating downgrades during the period include Gabon, Madagascar and Senegal, reflecting country-specific fiscal and macroeconomic challenges.
Outlook revisions also varied across Africa, signalling evolving risks and opportunities. Cape Verde, for example, received a positive outlook revision from S&P, indicating the potential for an upgrade if current economic improvements and fiscal reforms are sustained.
Beyond country-specific assessments, the report sets out a consolidated package of recommendations aimed at strengthening Africa’s sovereign credit profiles.
It calls for deeper and more structured engagement between African governments and international credit rating agencies to ensure that ratings adequately capture real-time reforms and policy adjustments.
The Outlook urges rating agencies to improve transparency in their methodologies and to reconsider rigid constraints such as the sovereign-ceiling framework, which often caps the ratings of domestic banks and corporates regardless of their individual financial strength.
It also recommends that rating agencies broaden their assessment of fiscal strategies to recognise domestic borrowing as a deliberate, development-oriented policy choice, rather than automatically interpreting it as a sign of financial stress.
At the same time, governments are encouraged to enhance fiscal transparency, improve data quality and diversify their investor base to reinforce market credibility.
A key theme of the report is the need for global rating methodologies to better reflect Africa’s structural and economic realities, including the role of informal sectors, development financing needs and reform momentum. The Outlook points to recent examples of tailored methodologies in other regions as evidence that more context-sensitive approaches are feasible.
Finally, the report underscores the importance of accelerating the operationalisation of the African Credit Rating Agency (AfCRA), which is expected to complement global agencies by providing assessments more closely aligned with African economic contexts, while contributing to broader reforms aimed at improving fairness, accuracy and inclusiveness in global credit markets.
The findings of the 2026 Outlook will inform upcoming policy dialogues, continental workshops and stakeholder webinars designed to deepen understanding of sovereign credit processes and support African countries’ engagement with global financial systems.
