On invitation from the African Peer Review Mechanism (APRM) Secretariat, working in collaboration with the Economic Commission for Africa (ECA) under the auspices of the African Union (AU), I attended the 8th Meeting of the Ad hoc Committee of Experts on Credit Ratings from 15-16 July 2023 in Nairobi, Kenya.
The objective of the meeting was to leverage and harness knowledge from African experts on rating agencies and encourage the exchange of experiences regarding matters of credit rating.
The first day of the meeting discussed themes such as the proposal for the establishment of an African Credit Rating Agency; emerging issues concerning credit rating agencies; and experiences and challenges related to sovereign credit ratings. These discussions provided valuable insights into the dynamics of credit rating agencies in Africa, with countries like Senegal, Ghana, and Nigeria sharing experiences and challenges in managing their credit ratings.
CABRI’s presentation on how it supports public debt management in Africa highlighted the critical pillars and activities underpinning sustainable public debt management, including:
Network Engagements of Public Debt Managers: Fostering a forum for building and strengthening relationships among public debt managers in Africa, sharing experiences on the sound practices of public debt management, and understanding the main challenges facing debt managers.
Policy Dialogues: Serving as instruments of change and knowledge dissemination by presenting case studies and research findings.
The first day of robust discussions on credit ratings concluded with a message to advocate for the harmonisation of common guidelines on the regulation of Credit Rating Agencies, better engagements with Credit Rating Agencies, and building capabilities in the management of sovereign ratings in African countries. This consensus underscores the significance of a unified approach in credit rating management.
As quality debt data owned by African countries is central to debt transparency, discussions on the importance of effective country data dissemination in credit rating assessments and the strengthening of data transparency through the IMF Data Standards Initiative were discussed on the second day.
The African Union Institute for Statistics presented their African data support initiatives. This emphasises the importance of enhancing data quality and accessibility in the debt management process.
Although discussed as part of CABRI’s presentation on the first day – CABRI’s unique African Debt Monitor (ADM), which is the first debt data repository beyond traditional debt reporting includes processes, policies, and institutional arrangements that demonstrate Debt Management Offices’ abilities to manage debt, cash, and associated risks.
The ADM briefing linked seamlessly with discussions on the second day concerning the importance of quality debt data necessary for efficient credit rating management processes.
Further, the ADM is part of the PFM knowledge management hub maintained by CABRI using country debt data as the primary source. This integrated approach reinforces CABRI's commitment to knowledge sharing and dissemination.
African countries in attendance were encouraged to take part in the next iteration of CABRI’s ADM debt data survey update to take place in a few months. This highlights the commitment to continuous improvement in debt data management.
CABRI will host the 8th Network Engagement of Public Debt Managers in Africa on 3 October 2023. This upcoming event will focus on hidden or undisclosed liabilities – how public debt managers are dealing with the challenges and what are the policy recommendations, underlining CABRI's commitment to addressing evolving issues in debt management.
CABRI remains at the forefront of initiatives aimed at enhancing public debt management in Africa. The recent discussions and presentations underscore the importance of knowledge sharing, data transparency, and harmonised approaches in building a sustainable future for Africa’s public debt management.