Uganda owes IMF nearly $1 billion while Kenya’s bill hits $3 billion

February 25, 2025 in Finance by Editor

Georgieva says the IMF works very closely with African countries in three ways, beginning with being a source of liquidity and reserves.

The International Monetary Fund (IMF), the people you turn to when you are faced with a foreign exchange shortage, has published its latest figures of money member countries owe to the Washington-based multilateral institution.

As of February 25, 2025, Uganda owes $992,750,000 (UGX3.65 trillion) while the East African Community’s (EAC) biggest debtor is Kenya at $3,022,009,900. Within the region, Ethiopia is another significant borrower now owing $1,498,040,000.

Egypt tops the table for African debtors at $8,173,127,517 while the least indebted is Lesotho at $11,660,000. Since its inception, only three African countries – Botswana, Libya and Eritrea – have never asked for IMF assistance.

In the EAC, the Democratic Republic of Congo owes $1,875,000,000; Tanzania, $1,009,260,000; Rwanda, $606,757,500; South Sudan, $246,000,000 and Burundi, $100,600,000.

In West Africa the bulk of the IMF borrowing is taken up by Côte d’Ivoire and Ghana at $2,682,628,440 and $2,506,118,500 respectively. Notably, sub-Saharan Africa’s two biggest economies of Nigeria and South Africa have been relatively restrained at $306,812,500 and $762,800,000 respectively. Angola owes $2.9 billion.

Besides Egypt, the other prominent borrowers in North Africa are Morocco ($831,350,000) and Tunisia ($676,365,753). Globally, at $31.1 billion, Argentina is the most indebted to the IMF, followed by Ukraine at $11.2 billion.

Technically, the IMF’s job is to ensure the stability of the international monetary system. In times of crisis, it acts as a lender of last resort, providing financial support to countries facing severe economic difficulties, as happened during the Covid-19, when many countries including Uganda sought urgent help.

In October last year, IMF managing director, Kristalina Georgieva, announced a reduction in borrowing costs specifically in terms of charges and surcharges, “The approved measures will lower IMF borrowing costs for members by 36 pc, or about $1.2 billion annually. The expected number of countries subject to surcharges in fiscal year 2026 will fall from 20 to 13.”

However these changes do not apply to IMF’s Poverty Reduction and Growth Trust, under which low-income members such as Uganda receive financial support on concessional terms.

Speaking during about the same interlude, Georgieva said, “We work very closely with African countries in three ways. The first one is to be a source of liquidity and reserves for them. We have provided special drawing rights allocation, which does not add to that. It adds to reserves and liquidity and we also provided financing on exceptionally high scale during the Covid-19 pandemic to help countries deal with pressing needs — 16 times higher lending than in normal times.”

She said, “Second, we work with countries to identify when debt is not sustainable and promote the restructuring through the common framework as well as in the discussions of the Global Sovereign Roundtable (GSDR). So far, we have had Chad, Ghana, Zambia and now Ethiopia, benefiting from debt restructuring.”

“And three, we are the only institution that actually provided debt relief during Covid, about $1 billion to the poorest 29 members, the majority of them in Africa. But let me say this, our biggest role to help Africa is to support Africa to grow. So, growth is the best way to beat that,” she said.

According to Afreximbank, which primarily finances trade, Africa’s debt burden has grown significantly in the past 15 years. Since the 2008 global financial crisis, the aggregated debt-to-GDP ratio of the continent has surged by 39.3 percentage points between 2008 and 2020 and thereafter declined to 68.6 pc of GDP in 2023. The debt trend is set to stabilize in 2024 and decline slightly thereafter. Afreximbank thinks debt as a percentage of GDP is set to decline further to 63.5 pc by 2028. Uganda’s is currently hovering about 53 pc.