Chiemeka Ugwowo
Africa losing $74.5bn to costly debt as Afreximbank warns of credit bias
BREAKING: Africa losing $74.5bn to costly debt over ‘biased’ credit ratings — Afreximbank
Africa is losing an estimated $74.5 billion in additional debt-service costs due to what the African Export-Import Bank (Afreximbank) described as exaggerated risk perceptions and unfair credit ratings.
The bank raised the concern at the 2026 Invest Nigeria Conference and Expo in Lagos, warning that high borrowing costs are limiting economic growth and investment across the continent.
Afreximbank’s Director of Regional Operations, Kudawashe Matereke, said Africa pays more for credit despite recording lower infrastructure loan default rates than several other emerging regions.
According to him, a study by Moody’s Analytics showed that infrastructure loan default rates in Africa averaged about 1.9 per cent, compared with 4.6 per cent in Asia, 10 per cent in Latin America and 12.4 per cent in Eastern Europe.
“Africa loses an estimated $74.5 billion in additional debt-service costs due to exaggerated risk perceptions and biased credit ratings,” Matereke said.
He noted that reducing borrowing costs by two percentage points over three years across an $18.6 billion loan portfolio could save Africa about $1.12 billion.
Matereke identified high interest rates, geopolitical conflicts, inflation, rising commodity prices and tighter financial conditions as major challenges facing African economies.
He disclosed that Afreximbank had approved a $10 billion Gulf crisis response programme to support African and Caribbean economies, businesses and financial institutions affected by rising import costs for fuel, food, liquefied natural gas and fertiliser.
The programme, he said, would provide foreign exchange and liquidity support while funding regional energy, logistics and port projects.
Meanwhile, the International Finance Corporation (IFC) said only 16 per cent of Africa’s exports were traded within the continent by the end of 2025.
IFC Division Director for West Africa, Olivier Buyoya, compared the figure with Europe’s 67 per cent and Asia’s 63 per cent, stressing the need for deeper economic integration.
Buyoya said the African Continental Free Trade Area (AfCFTA) offers Africa the opportunity to build connected markets, stronger value chains and attract more investment.
He added that Nigeria’s large domestic market gives local companies the potential to expand across Africa and become regional champions.
The IFC official said stronger regional trade would help African countries move beyond exporting raw materials by creating more value through agriculture, minerals, energy and manufacturing
