Key facts
- Moody's raised its outlook for sub-Saharan African countries to positive.
- Reforms, strong commodity prices and easier financing access improved fiscal positions.
- Region's economies expected to grow 4.3% in 2026 and 2027.
- Government borrowing needs to decline to 11.2% of GDP in 2027 from a peak of 12.3% in 2025.
- Total government debt to level off at 56.6% of GDP in 2027, down from 62.4% in 2025.
Moody's raised its outlook for sub-Saharan African countries to positive on Wednesday, citing reforms that have helped them weather inflationary pressures, while strong commodity prices and easier access to financing have improved their fiscal positions.
The credit rating agency cautioned that heavy debt repayment burdens, limited government income, and risks from climate change and regional security threats remain major weak spots. Moody's expects the region's economies to grow 4.3% in both 2026 and 2027, measured as a weighted average across countries.
Moody's forecasts that the amount governments need to borrow each year to cover deficits and repay maturing debt will decline to 11.2% of GDP in 2027 from a peak of 12.3% in 2025. Total government debt is predicted to level off at 56.6% of GDP in 2027, down from 62.4% in 2025. Zambia and Ethiopia are expected to see the biggest drops in debt, while Botswana and Gabon will see the sharpest rises.
Kenya and Zambia will each spend about 35% of their government revenue just on interest payments in 2027, more than any other country in the region. Moody's warned that a prolonged surge in inflation, severe weather events, or a sudden investor pullback from the region's bond markets could darken the picture.
Currently, only Botswana and Mauritius are investment grade among the 25 countries rated by Moody's in the region. Of the 25, eight have positive outlooks: South Africa, Namibia, Angola, Nigeria, Togo, Ghana, Republic of Congo and Zambia. Thirteen have stable outlooks, and four have negative outlooks: Mauritius, Gabon, Mali and Senegal.