Thread by @ThompsonWarren8

1/4 Why are so many African countries spending more on servicing debt than any other line item? For starters, rising indebtedness and the use of different types of external debt prevailed in the years before Covid, as we described here:
https://t.co/KlpXZuNo7Kfinanceuncovered.org/stories/what-i…

2/4 The pandemic simultaneously caused economies to "lockdown" while demanding huge public resources to respond to the medical and economic challenges caused by Covid. This led to even more indebtedness as seen in the rising debt-to-GDP ratios across the group of countries below:

3/4 While there was a strong economic recovery post 2020, the reopening was disjointed which significantly disrupted global supply chains. This, according to Joseph Stiglitz, is what created inflation in much of the Western world. And with inflation came higher interest rates!

4/4 Rising interest rates are not good news for African countries with external debt of $645bn, and which have also experienced currency weakness (due partly to higher interest rates). We explore this in some depth in our 2nd explainer @FinUncovered
financeuncovered.org/stories/explai…