The argument about African sovereign debt is usually conducted with the wrong number. The stock of debt relative to output is, in many African economies, lower than in the wealthy countries that lecture them about it. The number that matters is the share of government revenue absorbed by interest payments, and there the picture is genuinely alarming.
The reason is composition. A country that borrows in its own currency at long maturities from domestic pension funds is in a very different position from one that borrowed in dollars at high coupons during a decade of cheap money and now faces a wall of maturities. Several African issuers are in the second category through no failure of profligacy, simply because global rates moved.
What follows from this is that debt relief framed as forgiveness is less useful than instruments that change maturity and currency. Extending tenor, adding state-contingent clauses tied to commodity prices, and deepening domestic bond markets do more for fiscal space than a headline write-off that raises the cost of the next issue.
The uncomfortable domestic corollary is revenue. Tax-to-GDP ratios across much of the continent remain below fifteen per cent. No external restructuring substitutes for the ability to collect.
