Which African countries are highly indebted? How do Horn of African economies fare in this regard? Where does Ethiopia rank compared to her peers?Map - African nations with flag

A Debt-to-GDP ratio is the common tool used to measure the level of indebtedness of a country. Though there is no consensus on an optimal level, a debt-to-GDP ratio of 60% is often cited as a prudential limit for developed countries. For developing and emerging economies, 40% is the suggested debt-to-GDP ratio that should be sustained on a long-term.

Here below are two lists: The data for African nations in general and for East Africa in particular based 2013 data. [You may read brief explanations on technical terms at the bottom]

Highlight:

* Ethiopia is at 40th place with a an external debt to GDP ratio of 18.3 at 2013.

* Countries with comparable GDP size to Ethiopia such as Kenya (30.5%), Côte d’Ivoire (45.6%), Sudan (63.9%), Tunisia(55.9) and Ghana(29.3); all have higher external debt as a percentage of their GDP.

No.

East Africa

%of GDP

1.

Sudan

63.9

2.

Djibouti

48.4

3.

Seychelles

38.7

4.

Tanzania

36.4

5.

Kenya

30.5

6.

Uganda

26.7

7.

Eritrea

25.7

8.

Burundi

20.5

9.

Ethiopia

18.3

10.

Rwanda

17.6

11.

Comoros

17.5

12.

Somalia

13.

South Sudan

* Ethiopia’s Debt to GDP ratio for 2014 is estimated to be 20%.

The country with a higher external Debt to GDP is at the top of the list (Mauritania 101.9%) and the least debtor is placed at the bottom (Algeria 1.6%)

No.

Africa

%of GDP

No.

Africa

%of GDP

1.

Mauritania

101.9

27.

Malawi

25.5

2.

Cabo Verde

91.8

28.

Guinea

23.7

3.

Zimbabwe

87.5

29.

GuineaBissau

22.7

4.

Senegal

68.5

30.

Botswana

22.6

5.

Sao Tome

65

31.

Burkina Faso

22.5

6.

Sudan

63.9

32.

Mauritius

22.5

7.

Tunisia

55.9

33.

Congo

21.4

8.

Niger

55.3

34.

Sierra Leone

21.3

9.

Mozambique

53.4

35.

Angola

21.1

10.

Lesotho

49.1

36.

Gabon

20.7

11.

Djibouti

48.4

37.

Chad

20.6

12.

Madagascar

46.2

38.

Burundi

20.5

13.

Côte d’Ivoire

45.6

39.

Congo, DR

20.3

14.

Gambia

42.2

40.

Ethiopia

18.3

15.

Namibia

41.9

41.

Rwanda

17.6

16.

Seychelles

38.7

42.

Comoros

17.5

17.

South Africa

36.9

43.

Togo

17.4

18.

Tanzania

36.4

44.

Egypt

17.3

19.

CAR

34.7

45.

Benin

16.2

20.

Zambia

34.4

46.

Swaziland

13.5

21.

Kenya

30.5

47.

Liberia

10.8

22.

Morocco

30.4

48.

Cameroon

9.3

23.

Ghana

29.3

49.

Libya

6.8

24.

Mali

26.8

50.

Equ. Guinea

5.5

25.

Uganda

26.7

51.

Nigeria

3.2

26.

Eritrea

25.7

52.

Algeria

1.6

—–

Technical terms and notes

*External Debt: External Debt (total outstanding debt) is the amount, at any given time, of disbursed and outstanding contractual liabilities of residents of a country to non-residents to repay principal, with or without interest, or to pay interest with or without principal. It is the sum of public and publicly- guaranteed short and long-term debt, private non-guaranteed short and long-term debt and the use of IMF credit.

*The data is calculated by level of external debt As a percentage (%) of GDP (Debt-GDP-Ratio)

*The data used here is of 2013 and sourced from African Statistical Yearbook 2014 published by the African Statistical Coordination Committee (AfDB, AU, ECA).

*Ethiopia’s peer/comparable economies are selected based on their GDP (at current market prices size and PPP valuation)

***********

Fetsum Berhane

Fetsum Berhane is an Ethiopian resident, economist researcher and a blogger on HornAffairs.

more recommended stories