World Economy

Africa May Face Debt Crisis

Africa May Face Debt CrisisAfrica May Face Debt Crisis

Africa may have a problem with unsustainable debt on its hands if it doesn’t manage to find other ways to finance development and cut off illicit financial flows, a new report from a United Nations trade body has said, DW reported. While Africa’s external debt rations appear “manageable,” some countries on the continent may have a debt crisis on their hands similar to that of the late 1980s and 90s, wrote the authors of the UNCTAD Economic Development in Africa Report 2016, which was published on Thursday. In those years, Africa’s debt ballooned to $230 billion, at a time where the continent’s annual export earnings represented about a third of that. “Borrowing can be an important part of improving the lives of African citizens,” UNCTAD Secretary-General Mukhisa Kituyi says. UNCTAD said that at least $600 billion would be needed annually to realize the Sustainable Development Goals in Africa, or a third of the continent’s gross national income - and international aid and external debt aren’t going to be enough to cover that.