UN unveils Africa's sovereign debt

Executive Secretary of the United Nations Economic Commission for Africa Claver Gatete has noted that African countries collectively owe over $1 trillion in sovereign debt, with some nations struggling to meet their payment obligations.

Gatete highlighted the continent’s mounting challenges in financing, security, and climate change, Caliber.Az reports citing the foreign media.

“This is causing severe fiscal stress, with more than one in three countries either in or at high risk of debt distress,” Gatete stated during a regional meeting of the Southern African Development Community at Zimbabwe’s Parliament. “This is occurring at a time when long-term concessional finance, official development assistance, and foreign direct investment are all in decline.”

African countries, including Ghana and Zambia, have successfully reached agreements with their dollar bondholders after years of negotiations under the Group of 20’s Common Framework. Meanwhile, Ethiopia is set to resume negotiations with its bondholders in the coming weeks, following a landmark deal with the IMF last month.

Claver Gatete, Executive Secretary of the United Nations Economic Commission for Africa, also emphasized the devastating impact of climate change, which is eroding an average of five per cent of Africa’s GDP annually. Last year alone, Mozambique lost 15 per cent of its GDP due to climate-related events, he noted.

“That is why we are advocating for a comprehensive reform of the global financial architecture to ensure that Africa's needs are fully addressed,” Gatete said, highlighting concerns that the continent is not receiving equitable treatment from multilateral financial institutions like the World Bank and International Monetary Fund.