African finance ministers are working on a joint “Borrowers’ Club” designed to boost the bargaining strength of heavily indebted nations, improve knowledge-sharing, and offer technical support across the continent.
The proposal emerged from the G20 summit in South Africa, the first ever held on African soil. Leaders agreed to push for stronger debt-relief measures, overhaul the G20 Common Framework used for restructuring sovereign debt, and improve climate-resilience financing for vulnerable countries.
The club will sit within a wider G20 refinancing initiative for low-income and high-risk economies. The plan seeks fresh contributions from official lenders to help countries renegotiate and manage debt more efficiently. South Africa’s National Treasury and the African Union have thrown their weight behind the move, positioning it to complement existing mechanisms such as the Common African Position on Debt, the African Development Bank’s training programmes, and global efforts like the Sovereign Debt Roundtable.
A new report released at the summit, titled ‘Growth, Debt and Development: Opportunities for a New African Partnership,’ calls for a quicker, fairer and more inclusive system for resolving sovereign debt.
It highlights deep flaws in the current Common Framework and urges reforms such as automatic debt standstills during negotiations, more balanced burden-sharing across all creditors, and extending eligibility to middle-income states that increasingly rely on private lenders. Better debt transparency is also a priority, with calls for clear disclosure of creditor identities and loan terms to lower refinancing risks.
Delegates also argued for changes to credit-rating methodologies to reflect Africa’s varied economic conditions, alongside updates to global banking rules to support long-term infrastructure lending.
The urgency is clear: more than half of African countries are either in, or edging towards, debt distress. Many governments spend more on servicing debt than they do on healthcare or education. In 2023 alone, 17 countries recorded net debt outflows, sending more money to creditors than they received for development.
African leaders continued to push for a broader rewrite of the global financial rulebook, saying outdated risk models, high interest rates, and slow restructuring processes have tightened the continent’s debt squeeze.
Also Read: Ruto Heads To Angola For AU Summits
Alongside debt reform, governments want to spark new investment through regional platforms like the African Continental Free Trade Area and stronger development-finance institutions. The aim is to channel money into infrastructure and productive sectors, with a growing reliance on data-driven risk assessments to attract private capital.
The summit also addressed geopolitical tensions, with leaders pledging support for peace efforts in Sudan, the DRC, Ukraine, and the occupied Palestinian territories. They also recognised the importance of critical minerals in driving inclusive growth and the mounting impact of climate shocks on already burdened economies.
The event ended on a sour note after U.S. President Donald Trump refused to attend, accusing South Africa of discriminatory policies against its white minority and dismissing the host’s agenda on climate, diversity and financial reform. His absence is expected to weaken momentum behind several of the summit’s ambitions.
