How Africa’s debt trap chokes capital flow to SMEs (opens original article in a new tab)

Africa's rising public debt and high borrowing costs are limiting capital availability for SMEs and start-ups, with Ghana's debt crisis exemplifying the challenges faced by entrepreneurs.

• Africa's public debt increased by over 250% between 2008 and 2024, reaching $1.83-trillion.
• Ghana's debt crisis led to reduced venture capital investment and higher SME lending rates above 35%.
• Africa's borrowing costs are among the highest globally, averaging 8%-15% compared to 2%-3% in advanced economies.
• Ten countries accounted for 72% of Africa's public debt, with Northern Africa holding over one-third.