Managing Debt in a Crisis: A Critical Reckoning

Sub-Saharan Africa is facing a significant debt reckoning, exacerbated by historical borrowing from commercial creditors and Chinese development banks. The IMF reports that public debt in the region averaged 56% of GDP, which poses severe challenges given the high-interest rates characteristic of the area. Additionally, African nations are allocating around one-fifth of their total revenues to service external debts, reaching the highest levels since the debt forgiveness era of the early 2000s. This financial strain significantly restricts their ability to invest in vital services and development.