An op-ed by UNU-CPR senior fellow, Dr. Daniel Cash, in The Conversation argues that gaps in economic data – rather than underlying fundamentals alone – often shape how credit rating agencies assess countries, particularly disadvantaging developing economies. Incomplete or outdated information can lead to overly cautious ratings, increasing borrowing costs and constraining access to finance.
The article explains that when reliable data is lacking, ratings rely more heavily on subjective judgment, reinforcing risk-averse assessments. This creates a negative cycle in which weaker data leads to poorer ratings, limiting investment and the capacity to improve economic performance.
The piece concludes that reform should focus on strengthening data systems at the national level. Improving transparency and statistical capacity would allow countries to better signal their economic realities and access fairer financing conditions.
Read the full article in The Conversation.