Africa’s public debt currently stands at $1.8 trillion, at a time when the continent’s economic growth remains stagnant between 3% and 4% per year. The African Union (AU) has warned that this surge poses a serious threat to sustainable growth, social development, and fiscal stability across the region.
During the G20–Africa High-Level Dialogue on Debt Sustainability, Cost of Capital, and Financing Reforms, held in Addis Ababa, the AU raised concerns about the growing financial burdens weighing on African nations. Francisca Tatchouop Belobe, the AU Commissioner for Economic Development, Trade, Tourism, Industry, and Mining, represented the Chairperson of the AU Commission, Mahamoud Ali Youssouf, at the meeting.
According to Mahamoud Ali Youssouf, Africa’s debt service payments exceeded $70 billion in 2024 alone, consuming an increasingly large share of public revenues. “Many African governments are spending more on debt servicing than on investment in human development,” he lamented.
Official data shows that about 57% of Africa’s population lives in countries where debt service costs exceed social spending. This situation, Youssouf noted, worsens national vulnerabilities and limits the fiscal space needed to invest in key sectors.
The AU Commission Chair recalled that the continent’s public debt rose from $120 billion in 1990 to $1.8 trillion today. Despite this exponential increase, economic growth has remained virtually unchanged, fluctuating only between 3% and 4% annually.
The growing costs of debt servicing, Youssouf warned, are “diverting scarce resources from critical sectors such as education, health, and infrastructure.” This situation, he added, prevents African countries from advancing sustainably and ensuring better living conditions for their populations.
In light of this scenario, the AU official urged the G20 and international creditors to address what he described as “a systemic failure in the global financial architecture.” According to him, “it is a system built for a world that should no longer exist — a system that measures creditworthiness through biased metrics and perpetuates structural inequality.”
The AU Chair also called for the creation of a “new financial pact” that recognizes Africa’s shared responsibility in global economic growth and allows for fairer access to capital. “The challenge is not only to manage debt but to reinvent the financial system that sustains this imbalance,” Youssouf emphasized.
Under South Africa’s presidency, the G20 has shown signs of openness to strengthening Africa’s voice in shaping global economic policies. Youssouf highlighted that the creation of the African Expert Panel “signals a shift from consultation to co-creation — from inclusion to real influence.”
For the AU, this dialogue represents a decisive opportunity to “question outdated assumptions” and build a fairer global financial system, where Africa ceases to be “a debtor bound by obsolete rules” and becomes “a true partner in shaping a new economic order.”
Source: Business Insider Africa
