African countries, at the crossroads for the payment of external debt
By Jaume Portell Caño
The payment of external debt has become one of the main obstacles of African countries. With investments in health or education committed by the disbursements that states must carry out, many young people only find an exit in emigration.
When talking about the future of the African continent I can not stop thinking about the question that the young Youssouf diallo asked me one day. We were in Nandoari, one of the last towns of Senegal before reaching the border with Guinea. The scorching sun had given way to a slightly more respectful in the middle of the afternoon. It was then that I arrived at Alseyni diallo. Alseyni, a man who approached the age of 40, had short hair, a blue shirt and was sitting on the floor while answering my questions about his trip to Libya. He had spent thousands of euros and ended up imprisoned and subjected to torture of all kinds before returning to Senegal on a flight from the International Migration Organization. What bureaucratic language describes as “a voluntary return.” Back to the exit box, I now had a job in the local chimpanzee reserve, with a salary of about 300 euros per month. A luck in the context of the area, but insufficient to fill its curiosity of a better life elsewhere: “If I had the opportunity, I might try again,” he told me. Youssouf observed us silently until I asked him a question:
– Taking into account what Alseyni has suffered, would you try to go to Europe like him? Would you risk suffering the same?
Then Youssouf took the reins:
“It is me who asks you a question now.” What is the minimum wage in Spain?
–And 1 000 euros.
Youssouf shrugged and smiled, like saying there was nothing to talk about. I tried to add context – “Life in Spain is very expensive, with 1,000 euros you would not do anything, you would not have money and your life would be hell” – but Youssouf had already decided. He spent the day working as a mechanic, going to make repairs to the neighboring Mali, changing pieces and sweating to seas trying to give life to rough cars in exchange for about 50 euros per month. With just over 20 years, the idea of winning in a month what he would win in twenty months in Kedougou seemed to him the most stimulating project that one can have in his life. I neither have nor have many resources to convince him otherwise: beyond Kedougou, the situation of external debt only reinforces people’s impulses such as Youssouf.
Senegal must pay, according to World Bank figures, 4 billion dollars of debt maturities in 2026. The Senegalese government, led by Bassirou Diomaye Faye, has just discovered that their predecessor in office, Macky Sall, left them a country with a debt of almost 100 % of GDP, compared to the 75 % they hoped to have. They will be years of less investment in education, health and agriculture to pay the creditors. And, consequently, of fewer opportunities for young people who want to enter the labor market.
Corn for beer
In Bobo-Diulasso, the second largest city in Burkina Faso, Horakia Sawadogo has problems similar to those of Youssouf, although he faces them with a thread of hope thanks to a new government that recites old slogans. At 33, Sawadogo divides his time between sewing and the hectares of corn he cultivates with the rest of his family. He lives with his parents in the Sarfolao neighborhood: “I have a machine at home and I get dressed to have some money to live,” he says. Her clients bring her fabrics and she sews them and charges them for the service. To have your own clothing store, you should have an initial capital that does not have: “You have to have a lot of money to make a preparation for sale,” he laments.
Sometimes he collaborates with Catsya, a Catalan NGO that commissions him to make some fabrics that are then sold to finance the activities of the organization. Burkina Faso lives in the effervescence of revolutionary speeches since the arrival of Captain Ibrahim Traoré in September 2022. After a coup d’etat, this military promised the Burkines politically resurrect the spirit of Thomas Sankara and recover the territory controlled by the jihadists.
Sankara, a Pan -Africanist revolutionary, shook Sahel’s policy in the 80s with innovative measures in agriculture, economy and gender, but his career was cut at root with his murder in 1987, led by elements close to France, the old metropolis. Today, Horakia Sawadogo is optimistic about the country’s course: «I think things will improve, especially with the current government. Hospitals are being rehabilitated with the help of China and doctors without borders and in schools they are putting on the table more programs adapted to our reality ».
The government eliminated French as an official language and put it at the same level as Diula and Mooré, two of the most spoken languages in Burkina Faso. The great obstacle to Burkinean politics will be the growing debt payments: this year it will be 464 million dollars, a figure that will continue to rise every year until 2029. Despite the slogans of economic self -sufficiency of the Traorecé Executive, the country is immersed in an IMF setting program in exchange for receiving 300 million dollars up to 2027. Since September 2023, the IMF revised each six months State of the burkinese economy. If the African country meets what was promised, it receives a new round of financing. The measures proposed by the IMF include a tax increase and a rise in energy prices, together with a limitation of the official’s salaries. To get extra income, the government tries to negotiate with mining companies present in the country, a policy that their neighbors are also following in Niger and Mali. In a moment of maximum gold prices in the world market, Burkina Faso will need each dollar to square its budgets.
One of the presentation letters of the administration of Traoré is the promotion of food sovereignty. Fertilizer and machinery deliveries to peasants are announced insistent by their supporters in social networks. According to data from the United States Department of Agriculture, this year rice crops will be more large than in previous years. Consumption has increased so much that, however, import dependence has also risen: from 65 % to 71 % of the total. Other circumstances affect the situation of farmers: some grow corn for their own consumption, but a part of their harvest goes to Brakina, the most popular beer brand in Burkina Faso. Brakina is owned by the Castel Group, a French company. In “the country of full men”, in the midst of sovereign speeches, even the act of drinking beer serves to finance the companies of the old metropolis.
Two key years
Neither Senegal nor Burkina Faso live an exceptional situation with debt. Rather, it is a trend that is repeated throughout the African continent and in other countries of the Global South. As advanced by the United Nations Development Program (UNDP) at the end of February, “interest payments exceed 10 % of government revenues in 56 developing countries – almost twice that a decade ago. Among them, 17 countries allocate more than 20 % to the payment of interest, a threshold associated with the risk of default ». Given that, the UNDP urges leaders to prioritize three key reforms: a more effective debt restructuring framework, a systemic initiative of debt relief and a reduction in too high indebted costs.
In 2024 and 2025 the African continent will have paid more than 218 billion dollars in debt maturities, according to the International Debt Statistics of the World Bank. 45 % of these payments will be made to private creditors. Angola, South Africa and Egypt will be the countries that will pay more money between these two years, with disbursements that exceed 9 % interest. Angola is the African country where Spanish banks have bought more debt titles: in total, the African country owed 722 million dollars in 2023 from Spanish financial entities. According to Unctad, both Angola and Egypt spend six times more to pay the interest interest than in health.
Emigration as exit
Another of the prominent African countries in regards to indebtedness is Uganda. There, their young people live a situation of “hopelessness,” Gloria Kansiime, a national economist of the country, explains to the Black News Now Nigeria. Employed at a bank at the beginning of her career, she now works as a manager for an Italian company: “I started working with them in Uganda and from there I have been progressing,” he says. Now, with 32 years, he works in a nation of Western Africa, far from his parents and his family: «It is a bit difficult to get a good job in Uganda. You must have good contacts, meet someone in the circles of power to ensure the best positions, ”he says. For most Ugandes young people, the lack of opportunities in the formal economy ends up translating in precarious jobs or self -employment – mainly based on fruit trade, textiles or imported manufactures of low added value. Kansiime has been working with the Italian company for five years and laughs when I ask him if he sees a promising future for his country before responding enigmatically: “You never know until the elections arrive.” The Uganda president, Yoweri Museveni, has been in power since 1986 and, at 80, does not show signs of exhaustion. Therefore, Kansiime adds, it is good to work outside the country to diversify its employment opportunities beyond Uganda. Kansiime belongs to the Ugandesa middle class, a fact that has saved its father from almost safe death. In a country that spends almost five times more in the interests of debt than in health, the state of public hospitals is “alarming,” according to the economist: “Many public hospitals are not well equipped and people end up resorting to traditional medicine for basic diseases. If you have something more serious you will need a lot of money. That is why they transferred their father abroad, thanks to the advice of some members of Kansiime’s family who are doctors: «We had medical relatives who helped us. I can’t even imagine how these resources do not survive, it is heartbreaking, ”concludes Kansiime.
Uganda exports gold and, in the coming years, plans to start the export of oil. These resources will serve to continue guaranteeing the payments of external debt, as Kansiime explains: «We will take a long time to see how these resources benefit the most humble. The only way to pay the debt is selling these resources ». It is for that reason that many young people “have surrendered,” explains the economist, who adds that “many think that the president will never leave, so his goal is to earn some money, have fun with that money, drink and smoking. There are many parties and alcohol intake ».
One of those young Ugandes, Kaiza Rowland Raymond, was without inspiration in 2019 when he tried to make a song. Searching on Instagram, he found the video of a well -known shepherd in Uganda who complained about the frivolous lifestyle of young people who went to party party. It was at that time that the singer, known in Uganda with the Bigrril nick YouTube
Africa will need this type of creativity in the face of adversity to deal with the worst economic moment with respect to debt since the 80s.
