Fitch recently warned about the rapid spread of mpox virus in sub-Saharan Africa and the fiscal pressures it may add to the region. With the outbreak declared a health emergency by Africa CDC and WHO, concerns are raised about the impact on government finances.
Several countries in the region have confirmed mpox cases, leading to caution from Fitch about potential under-reporting and further outbreak acceleration. However, there are debates on the necessity and potential bias in the alarm raised by rating agencies.
Research shows discrepancies in how African countries are rated compared to Western counterparts, leading to the proposal for an Africa Credit Rating Agency. The lack of local presence of rating analysts in Africa, limited consultations, and biased qualitative assessments contribute to inaccuracies in ratings.
Addressing the biases by increasing Africa-based analysts and consultations can lead to more accurate and fair credit ratings for African countries.
Misheck Mutize, Post-Doctoral Researcher, University of Cape Town.