African governments have launched the Africa Credit Rating Agency (AfCRA) to address concerns that international credit rating firms underestimate the continent’s economic potential and inflate borrowing costs. According to a 2023 United Nations report, current rating methodologies were estimated to have cost African countries $74.5 billion in excess interest payments and foregone borrowing opportunities. But rather than compete with established agencies, AfCRA will seek to deepen the continent’s capital markets by expanding assessments of local-currency sovereign and corporate debt. Africa has an estimated $4 trillion capital base, much of which is parked in short-term securities. Furthermore, less than a quarter of this is covered by credit ratings. AfCRA aims to deepen the continent’s capital markets by helping redirect this capital to productive investment. However, its commercial prospects remain uncertain, and establishing international credibility will be critical.