

8:00 am EDT - 9:30 am EDT
Past Event
Editor’s note: Improved economic and political governance, together with a favorable global external environment, has set the foundation for Africa’s recent and much-heralded economic growth story. Although these features point to opportunities, they do not alone provide a sufficient basis for the type of sustainable and comprehensive development the region badly needs. In too many cases, governments and businesses in Africa encounter daunting economic, political, and social risks that reduce their ability to make long-term investment decisions and implement development policies. The Brookings Africa Growth Initiative (AGI) addresses this need through a private roundtable series that convenes high-level professionals from both the public and private sector for regular working group sessions to identify, manage, and mitigate the biggest risks to economic development in Africa. In addition to risks, the sessions seek to identify key trends in the continent, and formulate practical and implementable policy recommendations to leverage the opportunities on the continent.
As Africa continues its recovery from the 2014 commodity price slump, concerns are emerging that unsustainable debt poses the next great risk to the continent.
Public debt levels in Sub-Saharan Africa (SSA) are on the rise, and the pace of government borrowing is accelerating. Since the mid-2000s, when debt relief programs reduced much of the debt African countries had accumulated over previous decades, countries have once again intensified borrowing—increasingly turning to international markets and denominating debt in foreign currencies—to finance their fiscal deficits and urgent development priorities. In fact, the median debt-to-GDP ratio in Africa has increased dramatically in recent years, jumping from 34 percent in 2013 to over 53 percent in 2017. Debt levels now exceed 50 percent in 25 of the region’s 45 countries, compared to just 11 in 2013.
Although this ratio is still low by international standards, African countries’ debt has characteristics that suggest that the debt tolerance threshold is lower. For example, a large share of the debt is external and denominated in foreign currency; interest rates are higher; economic growth is more volatile, etc. Furthermore, many countries are commodity exporters and vulnerable to future commodity price shocks. Even so, there continues to strong appetite for African sovereign debt. Recently, several countries have issued eurobonds, which attracted a high level of interest from investors. As of March of this year, African countries had already sold about $13 billion in debt compared with $18 billion for 2017 eurobonds.
During this high-level roundtable, participants examined the state of debt management and sustainability throughout Africa, as well as how African governments are mitigating the risks of increased indebtedness. Participants also highlighted ways in which debt can serve as a productive asset rather than a liability. They also explored ways that private sector, donor, and international financing institutions can best support African countries facing debt challenges.
The following takeaway messages emerged from the discussion:
Chinasa T. Okolo
February 12, 2025
Karim El Aynaoui
February 11, 2025
Paul Prettitore
February 7, 2025