SA's G20 Presidency Focused On Ushering A New Era for African Debt Sustainability

Alvin Botes

On 10 November 2025, we had the privilege to lead a delegation of the South African G20 Presidency to host the G20–Africa High-Level Dialogue on Debt Sustainability, Cost of Capital, and Financing Reforms at the African Union Headquarters in Addis Ababa, Ethiopia.  

Our hosting of this event fulfilled a promise made by our political leadership at the AU Summit in Addis Ababa in February this year, that South Africa would host one of its G20 Presidency events at the African Union's headquarters. 

Following the African Union’s inclusion in the G20 in 2023 at the New Delhi Summit, we have been working hand-in-hand with the African Union to amplify Africa's voice in global economic governance, whilst ensuring that the development priorities of the African Continent and the Global South find expression firmly on the agenda of the G20.

It is for this reason that this High-Level Dialogue was not a dialogue for its own sake, but a strategic inflection point in how Africa, the Global South, and the world’s financial architecture confront debt, capital costs, and development finance. 

The speakers and panellists framed the Dialogue’s goal as exploring solutions for Africa’s debt, moving away from charity or bailouts, instead seeking a rebalanced, transparent, and development-first global debt architecture. The event’s name itself is instructive, as it signals a concerted effort to connect debt sustainability with cost of capital and financing reforms —three threads that determine whether nations can invest in health, education, climate action, and growth.

It is concerning that Africa bears a debt stock of about $1.8 trillion, with annual debt service around $90 billion. These figures are more than numbers; they represent foregone investments in critical public goods and climate resilience.

Even as economies recover from the pandemic, borrowing costs remain stubbornly high. The cost of capital is not just a market footnote; it constrains policy space, crowding out social welfare, healthcare, and infrastructure necessary for sustainable development.

“Debt Sustainability” addresses the core problem: how to ensure that debt burdens do not derail development trajectories.  “Cost of Capital” addresses the price and availability of finance for development, including sovereign risk premiums and the reliability of concessional finance. “Financing Reforms” signals a willingness to rethink global financial architecture: from debt relief processes to innovative instruments (debt-for-climate swaps, blended finance) and regional governance tools (African Credit Rating Agency, African Debt Monitoring Mechanism).

The Dialogue placed African voices at the centre, aligning with the Lomé Declaration and the African Union’s Common African Position on Debt. There was an emphasis on reforms that are practical, with a focus on building Africa forward and building differently rather than building back better. 

The High-Level Dialogue complements the efforts of the Africa High-Level Expert Panel to tackle the African debt crisis, chaired by former Minister of Finance of South Africa, Mr Trevor Manuel. It embodies the strategic shift from mere talk shop to a proactive policy recommendation that translates insights into lower borrowing costs and better capital allocation, including rechannelling of Special Drawing Rights (SDR).

The participants were unanimous that the G20 Ministerial Declaration on Debt Sustainability, signed during the G20 Finance Ministers and Central Bank Governors (FMCBG) meeting in Washington D.C., in October 2025, signals a political commitment to address unsustainable debt alongside rising capital costs, particularly in Africa.

Reforms proposed or under consideration include: faster debt treatment under the G20 Common Framework, automatic consideration of climate and development-related instruments in restructuring, and scaling of climate-linked debt swaps.

Furthermore, there was consensus that Africa’s regional instruments, such as the African Credit Rating Agency and the African Debt Monitoring Mechanism, are not ancillary but rather foundational to credible debt reporting, risk assessment, and capital attraction.

The Dialogue underscored that credible reform hinges on transparency in debt relief processes and the integration of climate and development outcomes into debt restructuring. It also emphasised the need to strengthen regional financial governance to reduce information asymmetries and enhance resilience.

The Dialogue advocated reforms that aim to create a more predictable, transparent, and development-oriented debt landscape, which in turn reduces risk premia and opens avenues for climate and infrastructure investments that align with long-term profitability and social impact.

It signalled a shift away from debt-as-crisis narratives toward debt-as-a credible policy instrument. It invites rigorous measurement, accountability dashboards, and independent evaluation of reform outcomes, anchoring reform in observable, results-driven metrics.

The Addis Ababa dialogue did not pretend to have solved the structural asymmetries of global finance in a single session. It, however, crystallised a shared understanding: debt should be a means to development, not a constraint on it. The path forward rests on a reformed, inclusive, and transparent debt architecture that aligns with Agenda 2063, the UN SDGs, and the broader Global South development agenda.

Our presence in Addis Ababa further allowed us to report back to the African Union on how South Africa integrated the 6 AU priorities of the G20 into its G20 Presidency agenda, namely:

• Achieving the Agenda 2063 and its Second Decade of Action and the UN SDGs;
• Reform of the international financial architecture;
• International food security and agriculture; 
• Just energy transition (electricity, renewable energy, and climate action); 
• Trade and investment; and
• Health and vaccine manufacture.

As such, we were glad to indicate that these priorities are reflected through the following key legacy outcomes of South Africa’s G20 Presidency:

• The Voluntary Infrastructure Investment Action Plan to Accelerate the Deployment of Clean Cooking Solutions.
• The Voluntary and Non-Binding G20 High-Level Principles on Sustainable Industrial Policy for Inclusive Economic Growth, Industrialisation, Jobs and Equality.  
• The Ubuntu Approaches on Food Security and Nutrition, and Excessive Food Price Volatility which the G20 Food Security Task Force produced and which seek to address the negative impacts of excessive food price volatility and persistent food inflation, particularly for low-income households, and set out our shared resolve to shape a future in which all people can access adequate, safe, affordable and nutritious food.
• The launch of the Artificial Intelligence (AI) for Africa Initiative, which was developed as a voluntary platform for multilateral and multistakeholder cooperation between the G20 and the African Union.
• The launch of the second phase (2025-2033) of the broadened Compact with Africa (2.0) supported by the establishment of a World Bank Group multi-donor fund under South Africa’s G20 Presidency, which will step up engagement with the private sector and integrate youth employment measures into Compact implementation plans.
• The South African Presidency initiative on a G20 Africa Cooperation Agenda on Trade and Investment, which is a voluntary and non-binding initiative to strengthen inclusive growth and development potential of Africa by harnessing support for the implementation of the AfCFTA, mobilize investments into Africa’s productive sector, and facilitate investments into key infrastructure projects in support of the African Union Agenda 2063. 

Lastly, as the event’s title portends, we must address debt sustainability, tame the cost of capital, and enact financing reforms that unlock Africa’s potential and advance global prosperity. The moment demands not rhetoric, but action—timely, accountable, and ambitious action that keeps faith with the promise of Ubuntu: solidarity, dignity, and shared prosperity for all.

As we are well into concluding the last few key meetings of our G20 Presidency, we believe that ending this year with this High-Level Dialogue held at the African Union symbolises the commitment and partnership South Africa has always placed on ensuring that this G20 Presidency is African-centred. 

We will soon be hosting the G20 Leaders’ Summit in Johannesburg, where we will once again promote greater collaboration between African nations and the rest of the world. As the leaders of the G20 return to Africa for this momentous occasion, South Africa will use this moment to bring the development priorities of the African Continent more firmly onto the agenda of the G20.

* Alvin Botes (MP) is the Deputy Minister of International Relations & Co-operation and a member of the ANC NEC and ANC NEC Sub-committee on International Relations. He writes in his personal capacity.

** The views expressed do not necessarily reflect the views of IOL, Independent Media or The African.