Comparative Public Debt Analysis for Five New SDC Members

Mar 29
4 min read

Updated: Apr 2

Understanding public‑debt dynamics is essential for assessing macroeconomic resilience and fiscal sustainability across African countries, particularly in a context of tightening global financial conditions and rising climate‑related vulnerabilities. The debt sustainability assessments (DSAs) conducted jointly by the IMF and World Bank provide a consistent analytical framework for evaluating solvency, liquidity pressures, rollover risks, and countries’ capacity to absorb shocks. Across the five countries reviewed—the Central African Republic (CAR), Eswatini, The Gambia, Rwanda, and Uganda—the latest DSAs reveal varying levels of distress but a common pattern of constrained fiscal space, heavy reliance on concessional financing, and exposure to external risks.

Central African Republic

The Central African Republic remains at a high risk of external and overall debt distress, with public debt assessed as sustainable but vulnerable to substantial liquidity pressures stemming from donor‑financing shortfalls and rollover risks in regional markets. Recent IMF and World Bank Debt Sustainability Analyses show that domestic borrowing has increased, causing the present value of total public debt‑to‑GDP to breach thresholds in 2024–2026, while external liquidity indicators also breach benchmarks due to rising debt‑service obligations. Sustaining debt viability will require continued grant financing, strengthened revenue mobilization, and efforts to lengthen domestic debt maturities amid persistent macro‑fiscal and governance risks.^[1]

^[1] International Monetary Fund. African Dept. (2025). Central African Republic: Third and Fourth Review Under the Arrangement Under the Extended Credit Facility, Requests for Waivers of Nonobservance of Performance Criteria, and Financing Assurances Review—Debt Sustainability Analysis. IMF Staff Country Reports, 2025(140), Article A002, A002. Retrieved Mar 29, 2026, from https://doi.org/10.5089/9798229013970.002.A002

Eswatini

Eswatini’s public debt remains manageable but faces growing fiscal pressures, driven by volatile Southern African Customs Union (SACU) revenues and structural weaknesses in public financial management. IMF assessments indicate that fiscal consolidation remains essential to reduce financing pressures, while economic growth is projected to improve gradually, supported by domestically financed investment. Continued reforms to strengthen debt management and enhance the efficiency of public expenditure are critical to safeguard fiscal sustainability. World Bank debt data show external public debt at 27.75% of GNI in 2024, with debt‑service pressures requiring improved fiscal discipline and better capital‑budget execution to mitigate vulnerability to shocks.^[1]

^[1] African Development Bank. (2024). Eswatini: Country Focus Report 2024 – Driving Eswatini’s transformation: The reform of the global financial architecture. African Development Bank Group. https://vcda.afdb.org/en/system/files/report/eswatini_final_2024.pdf

The Gambia

The Gambia remains at a high risk of external and overall debt distress, though public debt is still assessed as sustainable under the latest IMF–World Bank Debt Sustainability Analysis. Rising medium‑term external debt‑service obligations drive repeated breaches of the external debt‑service‑to‑revenue threshold, while elevated domestic debt vulnerabilities contribute to temporary breaches of the PV of public debt‑to‑GDP ratio. Nonetheless, public debt is projected to fall below the 55% of GDP benchmark by 2026, supported by fiscal consolidation, reliance on grants and concessional borrowing, and enhanced support from development partners. Debt dynamics remain vulnerable to export shocks and broader macroeconomic uncertainties.^[1]

^[1] World Bank, & International Monetary Fund. (2021). The Gambia: Joint World Bank–IMF Debt Sustainability Analysis. World Bank Group. https://documents1.worldbank.org/curated/en/712111644260893419/pdf/Gambia-Joint-World-Bank-IMF-Debt-Sustainability-Analysis.pdf

Rwanda

Rwanda faces a moderate risk of external and overall debt distress, though its space to absorb shocks has narrowed, according to the latest IMF–World Bank Debt Sustainability Analysis. Public debt remains sustainable but increasingly vulnerable to external, climate‑related, and liquidity pressures, with near‑term stress tests showing breaches of the PV public debt‑to‑GDP and PV external debt‑to‑GDP thresholds. The debt‑carrying capacity remains strong, but rising external debt‑service obligations, including future Eurobond repayments, heighten medium‑term liquidity risks. Sustaining debt stability will require credible fiscal consolidation, stronger domestic revenue mobilization, and careful prioritization of large investment projects amid heightened uncertainty around concessional financing.^[1]^[2]

^[1] World Bank. Rwanda - Joint World Bank-IMF Debt Sustainability Analysis (English). Debt Sustainability Analysis (DSA) Washington, D.C.: World Bank Group. http://documents.worldbank.org/curated/en/099040825180532827

^[2] International Monetary Fund. (2025). Rwanda: 2025 Article IV consultation and sixth review under the Policy Coordination Instrument—Press release; staff report; and statement by the Executive Director for Rwanda (IMF Country Report No. 25/319). International Monetary Fund. https://www.imf.org/-/media/files/publications/cr/2025/english/1rwaea2025002-source-pdf.pdf

Uganda

Uganda faces a moderate risk of external and overall public debt distress, with debt assessed as sustainable in the medium term, according to the 2024 IMF–World Bank Debt Sustainability Analysis. All public and external debt trajectories remain below indicative thresholds under the baseline, but stress tests indicate breaches in external and total debt‑service indicators, reflecting Uganda’s limited space to absorb shocks. Key risks include slower growth, environmental shocks, tight global financial conditions, delays in oil‑export projects, and potential reductions in external financing. Sustaining debt stability will require credible fiscal consolidation, stronger domestic revenue mobilization, and a transition from debt‑financed infrastructure toward private‑sector–led growth.^[1]

^[1] International Monetary Fund. (2024). Uganda: Staff report for the 2024 Article IV consultation—Debt sustainability analysis (IMF Country Report No. 24/290). International Monetary Fund. https://www.elibrary.imf.org/view/journals/002/2024/290/article-A003-en.xml

Sovereign Credit Ratings

The five countries are all rated non-investment-grade by major international credit rating agencies, reflecting elevated macroeconomic risks, limited fiscal buffers, and exposure to external shocks. The Central African Republic, which lacks recent rating updates, remains among the most fragile sovereigns, with public data indicating persistent challenges that keep it outside active rating coverage or at severely distressed levels. Eswatini has shown relative progress, following Moody’s upgrade to B2 in late 2024, citing improved fiscal management and institutional reforms that bolstered its credit profile ahead of 2026. In contrast, The Gambia continues to be rated at the lower end of the speculative scale, with agencies classifying it in the B– to CCC range, reflecting high debt vulnerabilities and narrow economic buffers. Rwanda currently has one of the strongest profiles in the group, with Fitch affirming its sovereign rating at B+ with a Stable Outlook in March 2026, supported by concessional financing and solid growth prospects. Uganda also remains in the speculative category, with Fitch affirming its long-term sovereign rating at B in February 2026, driven by governance constraints and ongoing fiscal vulnerabilities. Overall, these ratings highlight the region’s heightened exposure to financing risks and underscore the importance of concessional funding, structural reforms, and improved macro-fiscal governance to improve creditworthiness over time.^[1]^[2]

^[1] https://tradingeconomics.com/country-list/rating

^[2] https://www.theglobaleconomy.com/rankings/credit_rating/