Africa: The Response to Debt Distress in Africa and the Role of China

15 December 2022
analysis

Exploring solutions to African debt distress through multilateral cooperation

The economic consequences of the COVID-19 pandemic and Russia's invasion of Ukraine have undermined the ability of many African nations to service their sovereign debts. At present, 22 low-income African countries are either already in debt distress or at high risk of debt distress.

Chinese lenders account for 12 per cent of Africa's private and public external debt, which increased more than fivefold to $696 billion from 2000 to 2020. China is a major creditor of many African nations, but its lending has fallen in recent years and is set to remain at lower levels. This situation is likely to worsen over 2023, limiting the ability of African nations to raise the necessary finance to deliver broader social improvements for their populations and respond to climate change.

China did not cause African debt distress in most cases, but it is key to finding a solution. Despite growing political and economic tensions, China and the West have a strong mutual interest in cooperating with each other, and with African nations and institutions, to tackle the challenge of debt distress.

Dr Alex Vines OBE, Managing Director, Ethics, Risk and Resilience; Director, Africa Programme

Creon Butler, Research Director, Trade, Investment and New Governance Models, and Director, Global Economy and Finance Programme

Dr Yu Jie, Senior Research Fellow on China, Asia-Pacific Programme

Read the full research report here.

AllAfrica publishes around 500 reports a day from more than 100 news organizations and over 500 other institutions and individuals, representing a diversity of positions on every topic. We publish news and views ranging from vigorous opponents of governments to government publications and spokespersons. Publishers named above each report are responsible for their own content, which AllAfrica does not have the legal right to edit or correct.

Articles and commentaries that identify allAfrica.com as the publisher are produced or commissioned by AllAfrica. To address comments or complaints, please Contact us.