Public debt looms again in sub-Saharan Africa

What is the state of public debt in sub-Saharan Africa? After undergoing significant decline during the 2000s – thanks to economic growth fueled by rising commodity prices, increased foreign investment, and debt relief – public debt in sub-Saharan Africa rose again in 2013. Trends vary from country to country, however.

A number of factors have contributed to this rise in debt. One is the fall in raw material prices, especially of oil, which has penalized exporting countries such as Angola, the Democratic Republic of the Congo, and Equatorial Guinea. Another is the Covid-19 pandemic, which led to an economic crisis and additional expenditure to finance health systems and economic recovery programs. Evolutions in exchange rates have also played a role.

Public debt in sub-Saharan Africa stabilized in 2023 at the high level of about 60% of gross domestic product. But the situation is very different from one country to another: Botswana’s public debt accounted for 22% of its GDP in 2024, compared to 111% for Cape Verde

The risk of over-indebtedness

“Public debt is a key macroeconomic issue in sub-Saharan Africa, perhaps even more so than in the rest of the world,” warn Samuel Delepierre, Thibault Lemaire, Francine Nyankiye, and Arthur Sode of the International Monetary Fund (IMF), in an analysis of public debt in sub-Saharan Africa published in L’économie africaine 2026 (Éditions La Découverte).

Rising levels of public debt are indeed raising concerns about the risk of over-indebtedness in African countries. “An increasing number of countries are suffering conditions of over-indebtedness, or have a high level of risk of over-indebtedness, according to the debt sustainability analysis carried out by the IMF and the World Bank,” the authors emphasize.

While the cost of debt repayment is still below the levels of the early 2000s, it is placing an increasing burden on public finances at a time when sub-Saharan countries need to increase spending to finance growth and development.

“High levels of public debt can put pressure on budgets, diverting resources from critical spending to debt servicing, thereby increasing the risk of default,” say the IMF experts. 

Finding room for maneuver

Excessive debt can also lead to higher interest rates, curb private investment, and cause inflation. The increasing weight of the share of debt held by banks or other local financial players creates a different type of risk compared to external debt, as it concerns the State (refinancing risk) and the banking sector (sovereign risk).

On the other hand, according to the IMF experts, monitoring the level of public debt helps limit the financial burden for future generations, maintain investor confidence, support exchange rate stability, and preserve the government’s room for maneuver to respond effectively to economic crises.

“Three of the 10 countries with the highest growth rates have recently benefited from debt restructuring through the Paris Club. These processes are complex, but we can see the great importance of not letting a spiral of over-indebtedness develop,” says Thomas Mélonio, Chief Economist at Agence Française de Développement.

Crisis scenario ruled out

“While the international economic context and trade tensions in 2025 were a reminder of the risk of financial market instability, a systemic debt crisis scenario seems to be ruled out” in sub-Saharan Africa, observe the authors of the L’économie africaine 2026 chapter on public debt.

Multilateral creditors are working there and providing significant funding, especially in times of crisis. However, collaborative efforts between governments, bilateral creditors (such as Agence Française de Développement), and private and international organizations seem to be “crucial to reduce the risk of over-indebtedness, free up room for fiscal maneuver, and promote sustainable economic growth in the region”.