Some of the world's major economies could see their credit ratings downgraded or threatened with downgrades in the coming months, Roberto Sifon-Arevalo, executive director of sovereign ratings at S&P Global, told Reuters. He warned of a possible second wave of revisions related to the coronavirus crisis. Already in March, the rating agency Fitch sounded the alarm.

S&P has already downgraded the ratings or outlook of nearly 60 countries since the beginning of the year, but this movement has only slightly affected the richest countries, which are generally better rated. However, the colossal costs linked to support for health systems, businesses and employees since the start of the pandemic are profoundly degrading the public finances of certain countries. In one year, many of them will see their debt ratio (public debt/GDP) soar by 15 to 20 percentage points, a change that usually takes four or five years, while moving towards a increased spending for another three to five years.

“We are talking about the notes of the European Union or of very developed countries like Japan or the United Kingdom, or of the United States, which have been able to implement massive packages of budgetary and monetary measures to defend themselves” , explains Roberto Sifon-Arevalo to Reuters.

Ghana could be in the crosshairs

In total, 31 countries, or nearly a quarter of the total number of sovereign issuers rated by S&P, have their rating assigned a negative outlook, which in most cases leads to a downgrade. Among them are Australia, currently rated AAA-, Italy and Mexico, rated BBB, or Spain, rated A. And we should not rule out a new wave of negative outlooks either, in the context of the resurgence of the epidemic in many countries.

"At first, it will be a change of perspective", explains Roberto Sifon-Arevalo. "And then there will be those who, perhaps, will pull through and return to stable (outlook) in a few years. But then there will be those who will not become stable again and continue to descend the rating scale ."

Two other groups of countries in less good health are also threatened: in the first, in Latin America, Mexico and Brazil are under pressure, as is Colombia, which risks falling into the category of countries whose debt is considered speculative. ("junk").

The other group brings together several of the poorest and most indebted countries in the world in sub-Saharan Africa, and Roberto Sifon-Arevalo does not exclude that some will be forced to restructure their debt or default, such as Ghana or the Zambia or Angola. Zambia has already asked its international creditors to extend repayment terms, as its debt exceeds 100% of its GDP.

"You can imagine that when you spend 50 cents on every dollar, peso or whatever currency you earn, just to pay the interest on your debt, it starts to get difficult," Roberto Sifon-Arevalo said.

In agriculture, IFAD has just been rated AA+

In early March, S&P had already downgraded Nigeria's credit rating from "stable" to "negative" due to declining foreign exchange reserves.

Let us remember that if, often, the financing of agriculture in Africa is not done directly on the financial markets, the indirect links are there. In this regard, on October 2, the International Fund for Agricultural Development (IFAD) was awarded its first public credit rating, AA+ (stable outlook), with a short-term rating of F1+.

"This is good news for the world's most vulnerable and marginalized rural populations. Indeed, this rating should translate into increased investments for food security, jobs and economic growth. rural, and it marks a decisive step towards achieving the Sustainable Development Goals", underlined IFAD, which is the first fund in the United Nations system to be awarded a public credit rating.

“This high rating is timely, as the repercussions of Covid-19 now threaten to push millions of people into hunger and poverty. This rating will help IFAD consolidate and diversify its resource base , while building global resilience to future shocks,” said Gilbert F. Houngbo, President of IFAD.

IFAD-supported projects and programs are financed through contributions from its 177 Member States, investment income, loan repayments, and cofinancing from other sources.

While official development assistance has stalled in recent years, IFAD is examining new financing models to double its impact in reducing poverty and hunger by 2030 and adapt to the evolving needs of borrowing countries.

"To meet the needs of all its Member States, IFAD must have a diversified, broader and more predictable financial base in order to expand its financial offer in the interest of borrowing countries", explained Gilbert Houngbo. “This credit rating will give us greater flexibility to partner, including with the private sector as well as public development banks, with whom we will work together at the Finance in Common Summit in November. also how to make the best use of the public funds we receive, in order to maximize IFAD's support to the poorest and most deprived people."

An agricultural financial landscape in full reorganization

As specialized researchers Vincent Ribier and Jean-Jacques Gabas* already pointed out in 2016, "The institutional landscape of agricultural financing is being recomposed, with the multiplication and diversification of actors, as well as the growing intertwining of public and private financing. The desire to attract new private operators is reflected in the establishment of financial arrangements where public funds are supposed to play a leverage effect."

And to continue: "The traditional donors of the Development Assistance Committee of the Organization for Economic Co-operation and Development (DAC/OECD), subject to budgetary constraints, are seeing their relative importance in the financing of the agriculture for the benefit of new players: private foundations (such as Gates, Danone Ecosystem), new funds supported by private companies (livelihoods fund), players from emerging countries (China, India, Brazil in particular), private investment funds which position in the agricultural sector following the financial crisis of 2007–2008 (Afrique contemporaine, 2011), guarantee funds, not to mention funds from the diaspora, those from farmers themselves as well as financing from the sector This restructuring is particularly noticeable on the African continent."

Agriculture risks paying a heavy price for ratings reviews, one way or another.

* "Towards an accentuation of disparities in the financing of agriculture in West Africa?" , Cahiers Agricultures, November-December 2016,