Ghana ranks the seventh most indebted African country to the IMF, according to the IMF’s official website as of December 6, 2023,
The list shows the top ten African countries with the highest debts to the international financial institution.
Egypt leads the list with a debt of $11.9bn, followed by Nigeria with $1.8bn and Ghana with $1.6bn.
The IMF provides financial assistance to governments facing economic challenges. However, these loans can have significant and diverse impacts on their economies. Some African regions experience the negative effects of unsustainable debt levels.
Countries usually seek IMF loans when they face economic crises and need to stabilize their financial systems. These loans help mitigate the economic hardships of these countries.
IMF loans can also enhance the country’s finances until they find a more viable solution to their economic problems. Moreover, an IMF loan can increase the country’s reputation among foreign investors. This can lead to more foreign direct investment and better access to global capital markets.
However, these loans if not managed or utilized properly could hurt an economy. Aside from the fact that debts owed in general can cause financial stress in any economy, as it represents an expense that the country must take responsibility for, IMF loans often come with stringent conditions, including austerity measures such as reducing public spending, cutting subsidies, and implementing tax increases.
While these measures are intended to address fiscal imbalances, they can lead to social unrest and adversely affect vulnerable populations. These complications can also seep into the country’s exchange rate, making local currencies weaker than they should be.
With that said, below are the 10 African countries with the highest debts to the IMF, courtesy of the IMF’s official website.
10 African countries with the highest debts to the IMF.