A recent report from the African Export-Import Bank (Afreximbank) has revealed that Nigeria ranks among the top 10 African countries that are major contributors to the continent’s increasing external debt load.
The report titled African Debt Outlook: A Ray of Optimism reveals that, as of the first half of 2024, these 10 nations together account for 69% of Africa’s total external debt, up from 67% in 2023.
“South Africa leads with 14% of the total external debt, followed by Egypt with 13% and Nigeria with 8%,” the report states. Other countries on the list include Morocco (6%), Mozambique (6%), Angola (5%), Kenya (4%), Ghana (4%), Côte d’Ivoire (3%), and Senegal (3%).
Afreximbank links the growing debt to the underdevelopment of domestic financial markets and elevated borrowing expenses. The report points out that the heightened need for foreign currency to cover import costs has intensified external debt levels. Additionally, dependence on concessional loans, multilateral support, and private lenders has contributed to the increase in debt.
Since 2008, Africa’s external debt has surged significantly, amounting to about $1.16 trillion in 2023, which constitutes 60% of the continent’s overall public debt. The report anticipates an increase to $1.17 trillion by 2024, followed by a rise to $1.29 trillion by 2028.
