Africa Faces Unprecedented Debt Crisis, Urgent Reforms Needed
During the 11th session of the African Regional Forum on Sustainable Development, a press conference highlighted the persistent financial obstacles hindering the continent's growth trajectory. Jason R. Braganza, Executive Director of the African Forum and Network on Debt and Development (Afrodad), painted a worrying picture: Africa is facing an unprecedented debt crisis, requiring profound and urgent reforms.
In fact, over 25 African countries are currently experiencing financial distress or are at high risk of debt distress. This situation is exacerbated by an outdated and polarized global financial architecture. Faced with an increasingly complex landscape of creditors, Braganza called for the creation of an African debt negotiation platform, enabling African countries to speak with one voice during restructuring processes.
Moreover, the African Continental Free Trade Area (AfCFTA) was mentioned as a strategic lever. Despite initial implementation challenges, it represents a major opportunity to accelerate intra-African trade, stimulate local production, and lay the foundations for inclusive industrial development. However, this potential can only be realized if member states commit to coherent and coordinated policies.
In this context, Braganza emphasized the importance of reforming national borrowing and debt management policies. However, he stressed that these efforts can only bear fruit if they are part of a collective dynamic. Regional and continental cooperation appears as a crucial condition for strengthening the continent's weight in international financial institutions.
Some countries are already setting an example. Kenya and Rwanda have strengthened their legislative framework on debt, while Guinea stands out for its budget transparency. Nevertheless, the concrete implementation of these policies remains uneven from one country to another, making a harmonization of efforts at the continental level necessary.
Furthermore, an often-overlooked issue was brought back to the forefront: domestic debt. If not rigorously regulated, it can limit access to credit for the private sector, hinder investment, and compromise economic recovery efforts. Therefore, Braganza advocated for prudent management of this often-neglected component in national strategies.
Finally, to address these multiple challenges, the Afrodad Director formulated five key recommendations: creating an African platform for debt negotiation, strengthening the fight against illicit financial flows, effectively implementing AfCFTA, reforming national legal and policy frameworks, and managing domestic debt with prudence.
These proposals, if implemented in a concerted manner, could constitute the foundations of a more stable and sovereign financial trajectory for the African continent.
