The Africa Credit Rating Agency (AfCRA) is in talks with 15 African governments and expects to publish its first sovereign credit ratings by the end of March 2027, its interim chief executive has said.

The Mauritius-based agency said it was preparing research in countries including Togo, Kenya, Seychelles, Burundi and Mauritius. 

The AfCRA interim Chief Executive Officer, Sifiso Falala, told Reuters during an interview on Tuesday.

AfCRA was officially launched in Mauritius on 7 October. It aims to offer investors another assessment of African credit risk, drawing on regional data and expertise. 

The agency says it was intended to complement existing international rating firms, rather than replace them.

Ratings would be commissioned by governments

AfCRA plans to issue solicited sovereign ratings. Under this model, governments pay for assessments and provide access to officials and financial information.

The agency also plans to rate African multilateral lenders, including the African Export-Import Bank, as well as private financial institutions. 

Mr Falala said the agency wanted to rely less on information from international financial institutions such as the International Monetary Fund.

The ratings could influence how investors assess governments’ ability to repay debt. 

Lower ratings can raise borrowing costs by increasing the returns investors demand, and may limit access to some institutional investors.

Mr Falala described borrowing costs as a major burden for African economies. 

He cited an estimate that the continent pays an additional $75 billion a year in interest compared with borrowers elsewhere. 

The African Union estimates Africa’s annual external debt-servicing bill reached $163 billion in 2024, up from $61 billion in 2010.

Agency faces a test of independence and credibility

AfCRA enters a market dominated by S&P Global Ratings, Moody’s and Fitch. 

African leaders have criticised the firms, arguing that they overstate risks and downgrade countries too quickly during periods of economic stress.

The three agencies rejected claims of bias, saying they applied their methods consistently across countries. A 2024 Reuters investigation found no evidence of systemic bias in their sovereign ratings.

AfCRA is privately owned by South African research company Plus 94 Research. 

Mr Falala told Reuters it planned to raise $15 million through a share sale that would give African investors a two-thirds stake. The agency has also acquired a 51 per cent stake in South African firm Sovereign Africa Ratings.

The agency says it would not give African governments more favourable ratings simply because they are African. Its published position is that its assessments must be independent and evidence-based, including when the analysis points to a downgrade.

The African Union has said AfCRA alone would not resolve the continent’s financing challenges.