List Of African Countries With The Highest IMF Debt

Posted on 28 Oct 2024
List Of African Countries With The Highest IMF Debt
  • The International Monetary Fund (IMF) is one of the biggest lenders to African countries, but its loans come with conditions
  • Egypt tops the list of African countries with the highest IMF debt, with an outstanding loan of $11,272,939,177 (KSh 1.46 trillion)
  • FX Pesa lead market analyst Rufas Kamau told TUKO.co.ke that loans from international lenders help countries such as Kenya increase their forex reserves

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TUKO.co.ke journalist Japhet Ruto brings over eight years of experience in financial, business, and technology reporting, offering deep insights into Kenyan and global economic trends.

The International Monetary Fund (IMF) is a key player in global finance, providing financial support to countries facing economic challenges.

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In times of economic crisis, countries frequently turn to the IMF as a last resort to stabilise their financial systems.

These loans mitigate any economic hardships the aforementioned nations may be experiencing.

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Why do African countries borrow from the IMF?

According to FX Pesa lead market analyst Rufas Kamau, loans from the Bretton Woods institution also help countries such as Kenya increase their forex reserves, stabilising their currencies.

"It's in the interest of the Kenyan government to enter bilateral deals with our top trade partners to ease the pressure on foreign currency reserves. This is expected to strengthen the Kenya shilling in the short run," Kamau told TUKO.co.ke.

The loans also improve a nation's reputation among international investors. This increase in trust could result in increased foreign direct investment and improved access to global capital markets.

However, the loans often come with conditions that result in job losses and harsh austerity measures that governments must implement.

"Scaling down of infrastructural projects is an austerity measure being implemented across the board by the IMF and World Bank. It is a structural adjustment recommendation tied to their loans," Kamau added.

Which African countries have the highest IMF debt?

According to the IMF, the following countries have the highest debt as of June 2024.

1. Egypt

Egypt's outstanding debt on April 30 stood at $11,272,939,177 (KSh 1.46 trillion).

The North African country has since repaid $418,808,333 (KSh 54.27 billion). Its current debt stands at $10,854,130,844 (KSh 1.41 trillion).

2. Angola

Angola is another African country that has borrowed billions of dollars from the IMF.

The IMF revealed the Southern African nation's debt stood at $3,079,316,668 (KSh 399.05 billion).

The international financier noted Angola’s capacity to repay the loans was adequate despite elevated risks.

3. Kenya

The IMF board met on January 17 and approved a loan of KSh 150 billion to Kenya.

IMF approved an immediate disbursement of KSh 100.9 billion to relieve Kenya's financial struggles.

As of June 3, the IMF's total funding to Kenya across three facilities was $2,566,263,300 (KSh 332.56 billion).

4. Ghana

Ghana is one of the African countries that has been borrowing from the IMF to meet its financial needs.

In April, its loan was $2,055,925,000 (KSh 266.4 billion). It has since repaid $13,284,000 (KSh 1.7 billion), leaving a balance of $2,042,641,000 (KSh 264.7 billion).

5. Cote d'Ivoire

Cote d'Ivoire's total loan owed to the IMF stands at $1,940,385,704 (KSh 251.5 billion).

In March, the international lender approved a $1.3 billion (KSh 168.4 billion) loan to the West African country under a 30-month lending agreement.

Cote d'Ivoire is the largest grower of cocoa worldwide.

6. South Africa

South Africa has taken loans worth $1,907,000,000 (KSh 247.13 billion) from the IMF.

The IMF has been lending loans to South Africa since April 8, 1958 when it issued the first credit valued at $25,000 (KSh 3.2 million).

7. Nigeria

Despite economic reforms under recently elected President Bola Ahmed Tinubu, investors remain cautious about Nigeria, one of the largest economies in Africa.

This is due to record inflation, a declining value of the naira, and a shaky financial framework. Some corporations fled from the country.

Nigeria owes $1,227,250,000 (KSh 159 billion) to the IMF.

Which African countries have the highest Chinese debt?

China is one of the biggest lenders to African countries, accounting for 12% (KSh 94 trillion) of the continent's external debt.

Due to the extent of Chinese lending, the World Bank noted that seven African nations were either in debt distress or at risk of debt distress.

Angola tops the list of African nations with the highest Chinese debt.

Proofreading by Otukho Jackson, a multimedia journalist and copy editor at TUKO.co.ke

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