By Bunmi Yekini
As African leaders prepare for the upcoming African Union (AU) Summit, a new report by ActionAid has exposed a stark financial imbalance, revealing that lower-income nations are spending more on servicing foreign debt than on health care and education. The report, titled ‘Who Owes Who? External Debts, Climate Debts and Reparations in the Jubilee Year’, calls for urgent debt cancellation and climate reparations as Africa faces a worsening economic crisis.
According to the report, African nations collectively paid $60 billion in debt repayments in 2024 alone, funds that could have been used to bolster public health, education, and climate action. In contrast, rich polluting nations owe African countries at least $36 trillion in climate debt, yet have failed to make meaningful repayments.
“It is a travesty that African nations are being crushed under the weight of foreign debt, while the world’s richest countries continue to evade their responsibility to pay for the climate crisis and reparations related to the slave trade and unfair economic practices,” said Arthur Larok, Secretary General of ActionAid International. “By forcing countries to prioritize debt repayment over essential services, rich nations are pushing Africa to the brink.”
The report highlights the disproportionate financial burden on African countries, with many paying exorbitant interest rates on loans, an average of 9.8% compared to just 0.8% for Germany. This unjust global credit rating system, it argues, is exacerbating the debt crisis and keeping African economies trapped in financial dependency.
Chikumbutso Ngosi, Young Urban Women Programme Manager at ActionAid International, condemned the impact of IMF loan conditions on public services. “Servicing external debts and complying with IMF-imposed conditions is undermining spending on health, education, and climate action, particularly affecting women and girls. But rich countries get away without paying their debts to Africa. How is that fair?” she said.
The report also aligns with the African Union’s declaration of 2025 as the Year of Reparations, marking a pivotal opportunity for the continent to demand economic justice. Andrew Mamedu, Executive Director of ActionAid Nigeria, emphasized the urgency of systemic change. “The reality is that for African countries to overcome the debt crisis and the impacts of climate change, there must be debt cancellation and a complete move away from colonial debt architecture that has burdened the continent for decades,” he said.
Echoing this sentiment, Joy Mabenge, Country Director of ActionAid Zimbabwe, called for a fundamental overhaul of global financial systems. “In this Jubilee year, we need a complete shift in power over debt management—from the IMF to a more inclusive UN framework. The 4th UN Financing for Development Conference in mid-2025 presents a real opportunity for economic system change,” he said.
The ActionAid report urges the African Union to take a firm stance by advocating for:
- The establishment of a UN Framework Convention on Debt to replace the existing unfair system centred around the IMF.
- United demands debt cancellation as part-payment for climate debt and other reparations owed by wealthier nations.
As African leaders gather in Addis Ababa for the AU Summit from the 15th to 16th of February, the report serves as a clarion call to shift the global financial landscape and end what ActionAid describes as a cycle of economic injustice that has long stifled Africa’s growth and development.