Who decides what Africa is worth?

Countries on the continent could save up to $74.5 billion if sovereign ratings were based on less subjective assessments

On October 7, the African Union officially launched the Africa Credit Rating Agency (AfCRA) in Mauritius, giving the continent its own institution for assessing African sovereigns, companies, and financial institutions. AfCRA is not intended to replace Moody’s, S&P, or Fitch, but to introduce an African source of authority into a system that has long helped determine the price at which African countries can borrow.

On the surface, this is a technical event about ratings and capital markets. But the questions underneath it are political. Who decides whether an African country is a safe place to lend money? Who decides what interest that country should pay? And why should judgements made by institutions far outside the continent carry such enormous weight over the price of African development?

The AU says AfCRA will rate African sovereigns, sub-sovereigns, companies, and institutions. It is designed as a private-sector-driven, self-funded body, with governments barred from owning shares, and is meant to complement rather than simply replace the established global agencies. That may sound modest. In fact, it touches one of the unfinished questions of African independence.

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The price of a rating

A sovereign credit rating impacts directly the price of money. A government borrowing to build a railway or refinance debt enters a market in which investors judge the possibility of repayment, and ratings shape that perception. A lower rating can mean a higher yield demanded by investors and can influence the borrowing conditions facing banks and state-owned companies. An apparently technical judgement can therefore become a very material question: How much of the wealth produced by a country must be transferred to creditors simply to obtain capital?

The AU says Africa’s external debt-service payments rose from $61 billion in 2010 to $163 billion in 2024. UNDP research published in 2023 estimated that African countries could save up to $74.5 billion in excess interest and foregone financing if sovereign ratings were based on less subjective assessments. One does not have to accept every estimate, or conclude that every downgrade of an African country is unfair, to recognize the scale of the issue.

African states have real weaknesses: unsustainable debt, commodity dependence, narrow tax bases, incomplete statistics, corruption, and vulnerable currencies. An African agency that concealed these realities would destroy its credibility. But that does not make the existing system neutral. Ratings combine measurable indicators with judgements about institutions, reserves, and policy credibility. UNDP has identified foreign-currency bias and insufficient recognition of informal activity among the structural problems affecting African assessments.

Critics dispute that this amounts to systematic bias. That disagreement is precisely why Africa needs its own analytical capacity. The point is not to guarantee a better grade; it is to stop being the object being graded.

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Liberation is also financial

This is where the question of liberation enters. Political sovereignty answers the question: Who governs? Economic sovereignty asks a harder question: Who controls the conditions under which development is possible?

Colonial rule, while occupying territory, organized economies. Railways ran from mines and plantations to ports, commodities moved outward, manufactured goods moved inward, and financial authority remained elsewhere. Independence changed the political map, but much of that economic geography survived. Africa still exports raw materials, imports much of its machinery, and often borrows in currencies it does not control. Rating agencies did not create that structure, but they operate inside an architecture shaped by it.

This is why AfCRA is more important than whether it awards one country BBB instead of BB. It begins to contest who has the authority to interpret African economic reality. The AU says one objective is to strengthen Africa’s voice in global financial governance. Ratings agencies possess credibility that is itself is a form of institutional power.

AfCRA will still operate inside international capital markets. But changing who is authorized to produce credible judgements inside a system can still alter the balance of power within it. Financial independence is built by accumulating alternatives. A continental ratings agency challenges who defines risk. Regional payments systems reduce dependence on external channels. Local-currency finance reduces exposure to currencies controlled elsewhere. Development banks, monetary funds and, eventually, deeper monetary integration push the challenge further.

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From Gaddafi to BRICS

Africa has been discussing this architecture for decades. The 1991 Abuja Treaty envisaged deeper economic integration. The 1999 Sirte Declaration, adopted at a summit hosted in Libya and strongly influenced by Muammar Gaddafi’s campaign for a more united Africa, called for accelerating the institutions of the African Economic Community. The AU’s Constitutive Act later provided for an African Central Bank, an African Monetary Fund, and an African Investment Bank.

The AU still describes the intended purpose of the African Central Bank as creating a common monetary policy and eventually a single African currency. This history matters because Gaddafi’s argument about African unity was never only diplomatic. He pushed the question towards the material foundations of sovereignty. Could Africa be genuinely independent if its trade, reserves, borrowing, and development remained structurally dependent on financial institutions and currencies centered elsewhere?

There is a popular claim that Libya was preparing a gold-backed pan-African dinar that would displace the dollar and the CFA franc. That specific claim remains disputed and should not be treated as established fact. What is firmly documented is the wider project: Gaddafi’s pressure for continental union, the Sirte process, and the institutional agenda for an African central bank, monetary fund, and investment bank. The historical question is whether political unity can survive without economic and monetary power.

The same question now appears in another form through BRICS. The bloc has not created a common currency, and predictions of an imminent replacement for the dollar are exaggerated. But it is widening room for maneuver. In 2024, 43.5% of New Development Bank approvals were denominated mainly in Chinese renminbi and South African rand. The 2025 BRICS Rio Declaration also called for further work on cross-border payments and greater interoperability among payment systems.

These are attempts to create optionality, and optionality is where dependence begins to weaken. A country with only one lender accepts the lender’s conditions. A country with several credible sources of finance has bargaining power. The same is true of currencies, payment systems, markets, and rating institutions.

AfCRA belongs in that wider movement. It does not abolish Moody’s, S&P, or Fitch, but it introduces an African source of recognized judgement into a field where Africa has had little institutional power. That can influence how African risk is discussed, what data are considered, and which assumptions are challenged.

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What kind of economy are we financing?

Still, cheaper borrowing cannot be the final objective. Africa does not need liberation from expensive debt so that it can accumulate more cheap debt. The deeper question is what borrowed capital produces.

There is a profound difference between borrowing to finance consumption, recurrent deficits, or an extractive enclave that exports most of its value, and borrowing to build power generation, railways, fertilizer plants, machine industries, food-processing capacity, and regional supply chains. The first can reproduce dependency. The second can expand the productive base from which future repayment and development become possible.

That is why financial liberation and productive liberation cannot be separated. And neither can be separated from African unity.

Fifty-five fragmented states, many with small domestic markets and colonial trade patterns, will always negotiate from a weaker position than an integrated continental economy. A mine in one African country should be able to supply a factory in another, financed by African capital, transported on African infrastructure, sold across an African market and paid for through African financial systems. And that is actually the economic content of Pan-Africanism.

National sovereignty has limits when capital, production, trade, and finance operate at continental and global scale. For Africa, sovereignty has to rise to the continental level. The African Continental Free Trade Area enlarges the market; African payment systems can reduce dependence on third currencies; development institutions can mobilize savings towards African priorities. And AfCRA adds another capacity: to interpret and price African economic reality.

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When unity becomes power

None of these institutions should be romanticized. AfCRA can fail. If governments pressure it for favorable ratings, it will lose credibility. If it simply reproduces the methodologies of the established agencies with African personnel, its political significance will be limited. And if African ruling classes speak about financial sovereignty while continuing capital flight, raw-material dependency, and unproductive borrowing, the language of liberation becomes another slogan.

Its credibility may even require the agency, at times, to rate an African government more harshly than the established agencies. Independence is not demonstrated by giving Africa better marks. It is demonstrated by producing better analysis.

The launch in Mauritius should therefore be seen for what it is: one institution in a much larger struggle over economic power. African liberation was never completed by lowering colonial flags. It requires control over production, trade, finance, and the circulation of wealth. A fragmented Africa can ask for better treatment. A united Africa can create alternatives.

And that is where financial reform begins to become liberation.