Governor of the Bank of Ghana, Dr Johnson Asiama, has given a stark warning about Africa’s escalating debt crisis, calling for urgent international action to prevent further setbacks to the Sustainable Development Goals (SDGs).
Speaking at the African Consultative Group Meeting in Washington, D.C., on April 22, 2025, Dr Asiama revealed that nearly half of Sub-Saharan African countries are now at high risk of, or already in, debt distress, with interest payments surpassing health and education spending in many nations.
“Many developing countries, especially in Africa, face high and rising debt levels, with a shift in creditor composition, high rollover risks, and substantial financing needs, particularly following the recent successive shocks.
“These include the COVID pandemic, geopolitical tensions, financing squeezes, and climate-related disasters. Consequently, many African countries are contending with crippling debt service obligations, with about half of Sub-Saharan African countries at high risk of, or already in, debt distress at the end of 2024,” he said.
According to the Governor, this debt distress severely affects spending for social and development among the affected countries, which is further worsened by reduced international assistance.
“This severely constrains fiscal space for essential social and development spending and hinders progress towards achieving the SDGs. Most concerning is that per capita public expenditure on interest payments in Africa has surpassed spending on health and education, exacerbated by declining overseas development assistance,” he added.
Dr Asiama urged the IMF to bolster concessional financing through tools like the Poverty Reduction and Growth Trust and the Catastrophe Containment and Relief Trust.
“We urge the Fund to engage actively with members to secure the financing assurances needed for the distribution of GRA income
under the multi-year framework, ensuring its timely and effective implementation,” he said.
He also called for a revamped debt sustainability analysis (DSA) to better address climate risks and new debt instruments and demanded streamlined restructuring processes and private creditor participation.
“The IMF should ensure that the debt sustainability framework remains fit for purpose and effectively captures the unique vulnerabilities of developing countries, including climate-related debt risks and new debt instruments,” he said.
Dr Asiama stressed that African nations are committed to fiscal reforms but need coordinated support.
“Given the debt vulnerabilities exacerbated by climate change, we call for enhanced collaborative efforts. This includes proposing ambitious yet achievable and monitorable concessional financing options, establishing joint financing mechanisms, and developing common policy frameworks,” he concluded.
ID/MA
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