President Bola Tinubu has called for urgent reforms to the global financial architecture, arguing that African countries are paying excessively high borrowing costs due to persistent misjudgements by dominant international credit rating agencies.

In an opinion article, Tinubu said Africa continues to bear the burden of an “Africa premium” — a gap between how the continent’s economies are assessed and their underlying fundamentals.

Africa is paying too much to borrow, he wrote, insisting that calls to correct the imbalance can no longer be ignored.

The President singled out the world’s three major rating agencies — Fitch Ratings, Moody’s, and S&P Global Ratings — saying their assessments wield outsized influence over investor decisions and Africa’s access to global capital.

According to Tinubu, these agencies often fail to accurately reflect local economic realities, relying partly on subjective judgements about political risk and institutional strength, with limited on-the-ground presence across the continent.

He cited a 2023 report by the United Nations Development Programme (UNDP), which estimated that perceived rating distortions cost Africa about $75 billion annually in excess interest payments and lost lending opportunities.

Despite projections by the International Monetary Fund (IMF) that Africa will be the world’s fastest-growing region this year, only three African countries currently hold investment-grade ratings.

Tinubu described plans to establish an African credit rating agency as a “necessary corrective,” arguing that such a body could better capture reform momentum and local realities in real time. However, he stressed that any continental agency must build credibility through transparent, comprehensive and timely data trusted by global investors.

Highlighting Nigeria’s recent economic reforms, Tinubu pointed to improvements in data transparency, the rebasing of GDP, publication of additional budget documents, removal of fuel subsidies and exchange-rate liberalisation as steps that have strengthened fiscal management and supported non-oil growth.

He noted that while Nigeria has seen credit upgrades and strong investor appetite — with its November dollar-denominated bonds reportedly oversubscribed 5.5 times — ratings adjustments often lag behind reform efforts.

Downgrades become self-fulfilling, raising borrowing costs and straining public finances,” he warned, adding that smaller African economies bear the brunt of delayed upgrades.

Tinubu concluded that Africa’s rise represents not just a regional ambition but a global opportunity, noting that by mid-century the continent will account for a quarter of the world’s working-age population.

Africa’s success is not a regional concern but a global opportunity,” he wrote, urging a level playing field in global capital markets.