Etudes Economiques – BNP Paribas

In sub-Saharan Africa, public debt stabilises but vulnerabilities increase

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This story was published by Etudes Economiques – BNP Paribas on January 27, 2026 and curated on Africa Front.

January 27, 2026

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In sub-Saharan Africa, public debt stabilises but vulnerabilities increase 01/27/2026

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Sub-Saharan Africa has gone through 5 years of shocks that have weakened its public finances between 2020 and 2024. Over this period, public debt has risen rapidly, fuelling concerns across the region.

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But for several months now, there has been a positive evolution in public finance metrics:

1/ The fiscal deficit at the regional level has narrowed to 3.8% of GDP on average over 2023-2025, compared to 4.9% of GDP on average over 2020-2022.

2/ Public debt has finally stabilised at 58% of GDP in 2025.

However, concerns are resurfacing. In particular, the share of external debt in total public debt rebounded sharply in 2024 and returned to its 2019 level. Sovereigns are therefore more exposed to exchange rate risk.

Moreover, if we look at the net flows of external public debt, we observe a reconfiguration of the profile of external creditors that reveals new vulnerabilities.

1/ Since 2024, the share of private creditors in total external debt flows has rebounded significantly.

It reached 42% in 2024, compared to only 13% on average over 2020-2023. This rebound is mainly due to the return of African sovereigns to international capital markets after two years of tightening international financing conditions. In 2024 and 2025, 9 sub-Saharan African sovereigns issued on the international capital markets for an average annual amount of USD 14.7 billion, while no African sovereign had been able to issue between April 2022 and January 2024. This return of private bondholders means that sub-Saharan African sovereigns are once again much more exposed to the volatility of financing conditions in international markets.

2/ 2020 excluded, debt flows from multilateral creditors reached a record high in 2024 and are expected to decline as early as 2025.

Provisional data from the World Bank for 2025 indicate a contraction in multilateral lending, which is expected to continue in the medium term given the end of IMF programs on which many multilateral financing programs are conditional. In November 2025, 22 countries in sub-Saharan Africa were under IMF program, compared to 25 in December 2024. An additional 11 countries in the region are expected to see their IMF programs end in 2026.

3/ At the aggregate level, bilateral creditors are no longer granting new credit, and the trend is expected to continue in the short and medium term.

Since 2018, net bilateral debt flows have been in continuous decline, and they have turned negative since 2023. This is largely due to the withdrawal of Chinese bilateral creditors (On this subject read the Chart of the Week from Lucas Plé: Sub-Saharan Africa: China's credit rebound is an illusion).

The trend is expected to continue in the coming years as other bilateral creditors are not enough to counterbalance China's weight. Net bilateral debt inflows from Paris Club creditors are expected to remain subdued, as some creditors continue to grant new loans (Germany, South Korea, France, Italy, Japan, United Kingdom) while others withdraw from the region (Spain, the United States, Russia, the Scandinavian countries). Finally, the Gulf countries (GCC), which have become an important creditor since the end of the 2010s, will also not be able to counterbalance the withdrawal of Chinese credits.

In this context of the return of private bondholders and the withdrawal of official creditors, the dynamics of public debt should be monitored: while the debt ratio is stabilizing, the interest burden continues to rise. On average, it absorbed 18.5% of public revenues in 2025, an alarming level compared to other regions of the world.

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