The International Monetary Fund (IMF) says eight African countries are heavily indebted and need debt restructuring.
Kenya and Zambia are among the eight faced with high debt vulnerability.
In an interview with Bloomberg TV Thursday, IMF Director of the African Department Abebe Selassie stated they are working on mobilizing resources that will support policies needed to get these countries back to the pre-COVID period.
“The number of countries where debt is unsustainable and needs restructuring is about seven, eight now,” said Selassie.
“In most other cases what we are seeing is heightened debt vulnerabilities.”
Ghana is also on the list and together with Zambia, have sought IMF emergency bailouts and are in the process of restructuring their debts.
Ghana has already reached a staff-level agreement on the $3 billion loan programme from IMF, after which the West African nation will receive a second $600 million.
President Nana Akufo Addo of Ghana admitted last October that the country was “in crisis” citing “malevolent forces that have come together at the same time”.
According to Bloomberg, investors are keeping watch on Kenya, Angola, Malawi and Mozambique, among other heavily indebted countries on the continent.
IMF has already downgraded Sub-Saharan Africa’s growth forecast to 3.3% this year from 4% last year, before rebounding to 4% in 2024.
Weakening currencies, higher debt service costs and restricted access to capital markets have added to debt pressures.
Annual inflation across the region, which has seen violent protests against the cost of living in countries including Ghana and Kenya, is expected to be 16.2% at the end of this year.
