When Fitch Ratings cut the African Export-Import Bank’s long-term issuer rating to BBB- with a negative outlook on June 4, 2025, the announcement sparked immediate attention across African finance circles. The agency cited heightened credit risk, a non-performing-loan ratio of 7.1 percent, and exposure to sovereign restructurings in Ghana, Zambia, and South Sudan. Afreximbank issued a formal response disputing the assessment, and the African Union referred to the decision as a “misclassification”.
“A regional guarantee mechanism, capitalised by member states and institutional investors, could protect critical sectors – health, logistics, and digital infrastructure – against the reputational ripple effects of isolated downgrades.”
But beyond any one rating action, this moment highlights a deeper tension in global development finance: what defines risk? Who sets the standard for institutional credibility? And how do African-led institutions design for both agility and trust in a system where recognition remains uneven?
Until these questions are clarified, every downgrade or restructuring negotiation risks becoming less about the fundamentals of financial performance and more about navigating structural uncertainty, precisely when the continent is being called upon to mobilise domestic capital and scale homegrown solutions.
A credibility gap, not a capital gap
Afreximbank’s model, anchored by sovereign members and private shareholders, blending trade finance with sovereign lending, is structurally distinct. And like many evolving institutions, it resists easy classification within traditional MDB frameworks.
Yet when frameworks are not designed to reflect new realities, unfamiliarity often gets labelled as risk. And when benchmarks don’t evolve, perception begins to outpace performance.
In this environment, African financial institutions are often assessed by rules they didn’t help design, widening a credibility gap that’s too often mistaken for a credit one. The result? Investors’ cautious sentiment and higher capital costs only intensify the challenges these institutions are striving to surmount.
When “Risk” expands beyond the spreadsheet
Consider the context; Germany recently proposed cuts to its development budget, Spain doubled its grant commitments, and the World Bank re-entered nuclear energy financing after six decades. These are not isolated headlines; they reveal how capital, credibility, and global priorities are being constantly renegotiated.
African institutions are expected to operate within this flux, yet without clear terms for how their models are interpreted or judged.
Meanwhile, the continent’s financing needs remain urgent. Even under conservative assumptions, Africa currently allocates only about USD 59 billion annually to health yet needs roughly USD 160 billion to meet basic system resilience targets, according to WHO GDP-based benchmarks. That capital must flow through a range of platforms—sovereign wealth vehicles, DFIs, and blended finance—and each must navigate the same question: how do we build credibility not just to attract capital but to define the terms of our financial future?
Read also: Afreximbank opens up on Fitch Ratings report, says negative outlook reflects ‘debt risk’
Toward an African credibility framework
If risk is partly about perception, then credibility must be intentionally designed, not assumed, and not deferred to others.
Three areas of focus may help;
Define “preferred creditor” on our terms. African DFIs, ministries, and regulators can work toward a shared framework; capital buffers, sovereign exposure limits, and structured transparency standards. This is not about exclusion; it’s about building coherence across institutions working toward regional resilience.
Separate transparency from mimicry. Strong governance should never mean copying legacy models. Full compliance with global reporting standards can, and should, exist alongside innovations like publishing a “resilience return”; health, climate, or trade outcomes adjusted for volatility, tied to measurable impact.
Coordinate political risk at scale. A regional guarantee mechanism, capitalised by member states and institutional investors, could protect critical sectors – health, logistics, and digital infrastructure – against the reputational ripple effects of isolated downgrades.
For leaders shaping the future
For those of us leading programmes, partnerships, and policies at the intersection of capital and systems, this moment is a reminder that every funding conversation is also a governance one.
We must ask ourselves some critical questions:
What assumptions are built into the financial instruments we negotiate?
Whose definitions of risk and readiness shape the structures we accept?
How do we embed agency into the architecture, not only the language, of our financial tools?
This is not about defensiveness. It is about intentional design.
The goal is not to be validated; it’s to be understood on our own terms and to engage globally from a position of clarity and confidence.
Designing Through Volatility
In my previous column, I argued that Africa doesn’t need saving; it needs backing. The Afreximbank downgrade tests that thesis in real time.
If volatility is now part of the operating environment, then credibility must be part of our design brief; self-defined, data-anchored, and regionally reinforced.
Preferred-creditor status is not just a technical classification. It’s a narrative, a shared understanding of purpose, trust, and accountability. If African institutions articulate and uphold that narrative collectively, credibility will follow, and so will capital.
But the opportunity is broader; to build systems whose strength doesn’t rely on exception, but on intention.
That work is already underway. Let’s give it the structure it deserves.
Ota Akhigbe is Director of Partnerships & Programmes at eHealth Africa and writes a weekly column on systems and health equity for BusinessDay.
