South Africas G20 Presidency A Chance To Tackle The Debt Crisis

South Africas 2025 presidency of the G20 comes at a moment of global instability. Volatility in financial markets, escalating geopolitical tensions, and challenges to multilateralism have heightened the stakes for international cooperation. For South Africa, the first African nation to lead the G20, the challenge is immense but so is the opportunity.

President Cyril Ramaphosa has pledged to use the G20 to elevate the development priorities of Africa and all lower middle income countries. Central to these priorities is the urgent need to address the prohibitively high cost of capital.

This is not merely a technical issue it is a structural challenge that limits the ability of governments and businesses to invest in people, build resilience to climate change, and compete in the global economy. By tackling this issue head-on, South Africa has the potential to redefine the global financial architecture in ways that benefit not only Africa but the entire developing world.

In the decade leading up to 2022, Africas debt stocks more than doubled, rising from 283bn to 655bn. Private creditors and multilateral institutions accounted for the largest increases in 2023, accounting for 38 and 35 of Africas debt stocks respectively. In the same year China accounted for 12.4.

This debt accumulation was a logical response to historically low interest rates and the continents massive infrastructure needs. For many African nations, borrowing was not reckless but necessary.