The African Export-Import Bank (Afreximbank) has strongly condemned Fitch Ratings’ recent decision to downgrade its credit rating, describing the move as based on a flawed understanding of its treaty obligations. Last week, Fitch lowered Afreximbank’s rating from BBB to BBB-, placing it dangerously close to speculative or “junk” status. The downgrade was attributed mainly to worries over potential loan losses tied to ongoing sovereign debt restructurings involving Zambia and Ghana.
In a statement released Tuesday, Afreximbank pushed back vigorously against Fitch’s rationale, highlighting that the rating agency’s assessment rests on an incorrect assumption that the bank’s founding treaty—which has been signed by 53 African nations—can be breached without repercussions. Afreximbank insists that this treaty grants it a preferred creditor status, shielding it from compulsory restructuring in sovereign debt workouts.
The Cairo-based development finance institution has been actively involved in debt renegotiations with several African countries, including Ghana and Zambia. Throughout these protracted negotiations, Afreximbank has maintained that its unique legal standing exempts it from being treated like other creditors who may have to accept haircuts or extended repayment terms. This fundamental disagreement over Afreximbank’s role and protections in debt restructurings has fueled ongoing uncertainty and debate in the region’s financial circles.
By challenging Fitch’s downgrade, Afreximbank is underscoring the importance of its treaty framework as a safeguard that ensures it can continue to support Africa’s development without undue financial risks, even amid complex sovereign debt adjustments. The bank’s statement signals its determination to defend its position and maintain confidence among its member states and stakeholders across the continent.
