By Juliet Ezeh
President Bola Tinubu has intensified calls for a restructuring of the global financial architecture, backing the creation of an African credit rating agency as a strategic response to what he described as systemic bias in international lending assessments.
In an opinion article, the Nigerian leader argued that African nations continue to face disproportionately high borrowing costs because of persistent misjudgements by dominant global rating institutions. He said the so-called “Africa premium” a perceived gap between how African economies are rated and their actual fundamentals is imposing heavy financial penalties on the continent.
Tinubu pointed directly to the influence of the three leading global agencies Fitch Ratings, Moody’s Investors Service and S&P Global Ratings whose sovereign assessments heavily shape investor confidence and access to international capital markets. According to him, their models often fail to capture local realities and reform momentum within African economies.
Citing findings from the United Nations Development Programme, Tinubu noted that inconsistencies and perceived distortions in credit ratings cost Africa an estimated $75 billion annually through excess interest payments and forgone lending opportunities. He added that only three African countries currently hold investment-grade status, despite projections from the International Monetary Fund that Africa is expected to be the world’s fastest-growing region this year.
The President argued that a continental rating agency would serve as a corrective mechanism, particularly by strengthening on-the-ground analysis and reducing reliance on opaque methodologies. He criticised what he described as “analyst discretion” in current rating models, where subjective assessments of political and institutional risk can outweigh measurable economic indicators.
Tinubu also warned that downgrades often amplify global financial cycles rather than reflect domestic fundamentals. Commodity-dependent economies, he said, are frequently penalised during global downturns even when fiscal buffers remain intact. Such downgrades, he argued, can become self-fulfilling by raising borrowing costs and weakening public finances.
While advocating reform, Tinubu stressed that any African-led rating institution must earn global investor confidence through transparency, timely data, and credible governance standards. He pointed to Nigeria’s recent credit upgrades as evidence that improved data disclosure and policy reforms can influence external perceptions. Measures such as incorporating previously off-balance-sheet central bank lending into official debt records, rebasing gross domestic product figures, and publishing additional budget documentation were cited as steps toward greater transparency.
He further referenced key domestic reforms, including the removal of fuel subsidies and exchange-rate liberalisation, which he said have supported non-oil sector growth and economic diversification. Despite these measures, Tinubu observed that rating upgrades across Africa often lag behind reform efforts, while downgrades occur more swiftly.
The President noted that Nigeria’s recent dollar-denominated bond issuance was oversubscribed 5.5 times, suggesting strong investor appetite that may not fully align with current ratings assessments. He argued that a continental ratings body could help reflect reform momentum in real time, enabling countries to access capital markets more efficiently after implementing structural adjustments.
Positioning the issue within a broader demographic and economic context, Tinubu emphasised that Africa’s rise carries global implications. By mid-century, the continent is projected to account for a quarter of the world’s working-age population, underscoring its growing significance in global economic dynamics.
Although he acknowledged that global capital markets will continue to rely on established international agencies, Tinubu maintained that an African credit rating institution could provide an early and regionally grounded signal of economic progress. Such a platform, he argued, would help ensure that African countries compete for capital on fairer and more balanced terms.
Juliet Ezeh is the founder and chief reporter at Westbridge Reporters with over 7 years of experience in journalism. She covers crime, industry, policy, and social developments, delivering timely and accurate reporting.