Africa’s new credit rating agency, Sovereign Africa Ratings (SAR), is about to issue its first credit rating report on South Africa, an undertaking that promises to truly give Africa and its markets independent, fair and unbiased opinions about their creditworthiness.  

The highly anticipated official launch will take place on 23rd September 2022 at the Waterfall City Courtyard Hotel in Midrand, South Africa. Stakeholders and guests from the financial services sector are expected to attend the event. Prof. Steven Friedman of the Centre for the Study of Democracy, Gregory Mofokeng, Black Business Council Vice President and Adv. Kevin Malunga, Former Deputy Public Protector are among the guest speakers invited to the event.

Dr Sifiso Falala, SAR’s founder and CEO says this event is a major milestone for the CRA as it marks the beginning of a new era in the ratings industry, not only for South Africa but also for the African continent and the world.” Previously, all African economies have been rated externally and this is a significant change because the people that have been providing retrospective ratings represent the interest of external investors. We know their interest is in their own balance sheet and their own interest margins and not the development of the continent of Africa. We are an African agency, and we are committed to the development and prosperity of the continent,” says Falala.

The new kid on the block is ready to take on the big three, Moody’s Investors Service, S&P Global Ratings and Fitch Ratings CRAs that have almost monopolised the market for generations. 

According to SAR’s Chief Operating Officer, Zwelibanzi Maziya, the purpose of the launch is to introduce and present SAR to Africa and the world. “We will issue our first credit rating, a sovereign rating on South Africa. This will demonstrate the difference between an independent and a foreign opinion, it is very important not to confuse one with the other. We aim to ensure that Africa and emerging markets have independent, fair, and unbiased opinions of their creditworthiness. This event marks the beginning of a new era. The commencement of SAR is a demonstration of our resolve and courage as it marks the moment Africa moves from the sidelines and enters the field in this industry,” Maziya says. 

After years of African countries feeling unfairly treated by existing foreign agencies, there has been a chorus of calls for an alternative that would judge the continent’s nations on merit and on their true credit performance. Since March 2022, when the Financial Sector Conduct Authority (FSCA) granted SAR its license, it is anticipated that SAR will be the CRA to provide the much-needed new perspective. 

Elaborating on early spadework undertaken, Maziya says: “The company has been focused on establishing a strong team and efficient internal processes and systems, we have achieved this and will continuously grow. Extensive research and engagements with stakeholders in economic analysis, credit, and financial risk fields as well as academics are all part of our day-to-day activities. As SAR, we look forward to making positive contributions to the economic and financial research spaces to encourage stability for real growth,” he adds.

Asked why the industry stakeholders must attend the launch, an ecstatic Maziya was quick to respond: “It is nice to be part of significant moments in history. The first African credit rating agency focusing on emerging markets’ sovereign ratings, licensed, regulated, new entrant into an oligopolistic international industry. It is not an event I’d want to miss.”

The upcoming event will see the release of a ratings report by SAR Chief Ratings Officer David Mosaka.

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