Debt repayment costs are rising fast for many African countries

AFRICAN FINANCE ministers trying to manage debt must be cursing their luck. First the pandemic slammed their finances. In December a pandemic-inspired scheme to suspend interest payments to bilateral creditors ended. It had delayed debt problems but did not fix them. In February Russian tanks rolled into Ukraine and jumpy investors began to ditch African government bonds. In March the Federal Reserve began to raise interest rates, which will make financing pricier everywhere. Meanwhile, China, a big economic partner for the continent, is struggling because of a rumbling property-debt problem of its own and lockdowns to slow covid-19.

All this has taken a toll. In 2015 the IMF judged that eight countries in sub-Saharan Africa were in debt distress or at high risk of it. Zambia defaulted in 2020. By March the IMF’s list had grown to 23 countries. African governments owe money not only to rich countries and multilateral banks but also to China and bondholders.