Last week news that Moody’s Investors Service lowered its sovereign rating by one notch from B1 to B2 and maintained its negative outlook.
For Ghana, it was just the latest blow in a week full of them.
The country’s woes began Thursday when the Black Stars, Ghana’s national men’s soccer team, expelled two of its star players, Sulley Muntari and Kevin-Prince Boateng, for launching verbal and physical attacks against team management.
That put the team in a tough spot ahead of its do-or-die game against Portugal at the World Cup
A half hour into the game, Ghana’s slim chances of advancing took a hit when defenceman John Boye saw the ball spin off his leg and into the net – a demoralizing own-goal.
Sixty minutes later the team’s World Cup hopes were dashed as Portugol won 2-1.
Today’s credit rating downgrade was largely driven by two factors. The first is a high and rising debt burden that has led to greater interest expenses.
Ghana’s interest payments have increased from 14% of revenues in 2012 to 23% in 2013.
This has triggered the second main cause: higher exposure to event risk due to the government’s surging financing needs.
An early World Cup exit and an ominous financial forecast – it is sure to be a somber week in the West African nation.