Home Ghana News Gov’t procured positive credit rating from ‘discredited’ Moody’s- Adongo

Gov’t procured positive credit rating from ‘discredited’ Moody’s- Adongo

Member of Parliament (MP) for Bolgatanga Central Constituency Isaac Adongo has said International Credit Rating Agency Moody’s lacks credibility, a reason its recent credit ratings on Ghana does not reflect the actual state of Ghana’s credit rating position.

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Moody’s in a statement issued on Friday, January 24, 2020
stated that “Moody’s investors Service (Moody’s) has today reaffirmed the
government of Ghana’s long-term issuer and senior unsecured bond ratings at B3
and changed the outlook to positive from stable”.

The credit rating firm which has in past years rated Ghana
on its credit position further stated that “the decision to assign a positive
outlook reflects Moody’s rising confidence that the country’s institutions and
policy settings will foster improved macroeconomic and

fiscal stability over
the medium term, in part as a consequence of the reforms implemented under the
recent IMF reform programme”.

Following this pronouncement, government expressed delight
and indicated that the scoring of a B3 positive rating from stable, shows a
prudent management of the economy and fiscal discipline with the implementation
of key fiscal reforms.

But speaking on Metro TV’s Good Evening Ghana monitored by MyNewsGh.com, Isaac Adongo rubbished the recent credit rating achieved by Ghana in Moody’s report.

According to him, the credit rating firm has a bad record of
misleading investors in the United States in 2008 and was subsequently charged
to pay in excess of $800 million over lost investments following its inflated
ratings.

“Moody’s is a discredited institution on which the
government of Ghana is trying to rely on for credibility. As we speak today,
Moody’s is one of those institutions that were sighted for inflating ratings of
mortgage companies in America that led to the 2008 financial crisis involving
sub-prime mortgages in America,” he stated.

The minority Member of Parliament argued that subsequent to
the wrong ratings the agency gave in America in 2008, several investments were
lost.

“As we speak today, Moody’s has agreed to pay $864 million as penalties for misleading investors in America to buy sub-prime mortgages on account of they (Moody’s) inflating ratings. This is the kind of discredited institution that the government of Ghana is now relying on for credibility to sell its bonds,” he added.

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Mr. Adongo also accused the Nana Addo led administration of
procuring the recent ratings from Moody’s while stating emphatically that
available data and analysis on Ghana’s economic indicators does not fall in
line or support the conclusion of the International credit rating agency.

Source:MyNewsGh.com/Stephen Zoure/2020

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