AfDB “Spotlight” on Debt Management Highlights Momentum in Debt Restructuring, Other Fiscal Reforms in Africa
African countries are demonstrating meaningful progress in sovereign debt management to achieve inclusive growth and structural transformation. The reforms, from fiscal tightening in Ghana and new debt legislation in Zambia to debt reporting transparency in the Gambia, were highlighted during a capacity development support event hosted by the African Development Institute through its Public Finance Management Academy for Africa (PFMA) in Accra, Ghana.
The week-long training, held from June 30 to July 4, 2025, was organised to support more effective sovereign debt management and loan negotiations amongst the continent’s transition countries, most of which are in debt distress, or at high or moderate risk of debt distress. Africa’s Transition States are the continent’s most vulnerable economies, facing a wide range of political, economic, security and environmental challenges, and striving for greater stability and resilience.
With the theme, “Strengthening Capacity for Loan Negotiation and Debt Restructuring in Africa’s Transition States”, the Accra gathering was the second edition of the PFMA’s Spotlight on Public Debt Management in Transition States. The first took place in Addis Ababa, Ethiopia, in June 2024.
In opening remarks, Ghana’s Deputy Minister of Finance and Economic Planning, Thomas Nyarko Ampem—outlined the successes of the country’s economic reforms, especially in debt restructuring, embarked upon in the wake of recent debt distress, thus offering valuable lessons to other African countries.
Ampem’s remarks showcased Ghana, though not a Transition State, as a worthy role model in fiscal reform for Africa’s most fragile countries. According to him, Ghana has experienced “one of the fastest credit rating upgrades post-debt restructuring in recent global developments. What this means is that one cardinal objective of the IMF programme, which was the restoration of international market access, has been achieved far ahead of time.”
The country recorded 5.3% GDP growth in the first quarter of 2025, exceeding the year’s target of 4.0%, while confidence indices among consumers and businesses have reached seven-year highs, and inflation has dropped to its lowest level since 2022. The Ghanaian cedi has also recently been ranked the best-performing currency globally.
Ghana’s legislative reforms include strict penalties for breaching the laws prohibiting extrabudgetary spending, and a requirement that no government entity may secure loans without the written consent of the Finance Minister. Zambia—which like Ghana is not a Transition State, is among four African countries to seek debt restructuring under the G20 Common Framework, along with Chad, Ghana, and Ethiopia—has recently passed legislation establishing a Debt Management Department, further strengthening its public debt oversight, and helping to advance its debt restructuring efforts under the G20 Framework.
Lessons also came from Transition countries like Sierra Leone and the Gambia. Sierra Leone’s economic reforms, including ramping up transparency around public sector debt, and demonstrating the political will to clear debt arrears, have helped engender confidence; inflation is down from 52% in late 2023 to around 7.5% in April 2025. Similarly, The Gambia has lowered its debt-to-GDP ratio from over 120% in 2017 to 74 percent at the end of 2024, supported by regular debt sustainability assessments and prudent fiscal management.
“We have a lot of good lessons within Africa, that we can learn from… African countries have solutions for most of the problems facing them, but we need to look inward enough,” said Dr. Eric Ogunleye, Director of the African Development Institute. “At the African Development Bank, our focus is to make debt work better for Africa.”
Participants floated the idea of an “Accra Club”—a borrower coordination platform that would mirror the role of creditor groups like the Paris and London Clubs, and enable sovereign borrowers to present more unified positions in negotiations and enhance their collective bargaining power. The training also highlighted the importance of developing credible early warning systems for debt distress, allowing countries to better anticipate and manage these scenarios.
The African Development Bank, through the African Development Institute, continues to play a central role in supporting public finance and debt management reforms across the continent. Notable initiatives include the creation of the Public Finance Management Academy for Africa, the Africa Debt Managers Initiative Network (ADMIN), the Debt Management Forum for Africa (DeMFA) and the PFMA Spotlight on Public Debt Management in Transition States—all designed to strengthen institutional capacity across the continent.
“The African Development Bank is your bank,” Ogunleye affirmed to participants in remarks to close the event. “We stand ready to work with all partners everywhere, not just in proffering solutions, but also in implementing them for sustainable impact and outcomes.”
