By 2030, Nigeria must repay $6.4 billion in Eurobonds, a figure that places it alongside Ghana as the third-highest among sub-Saharan African nations monitored by the World Bank.
In its recent Building AI Readiness report, the World Bank cautions that shifts in African sovereign borrowing patterns and costs could lead to persistent refinancing challenges, potentially undermining governments’ financial flexibility.
Refinancing Challenges
The World Bank highlights that Eurobond financing is increasingly characterized by a cycle of refinancing, where short-term maturities are addressed through rollovers, but at the cost of higher debt servicing, gradually limiting fiscal maneuverability. Between 2015 and August 2026, Nigeria was the region’s second-largest Eurobond issuer, securing approximately $20 billion across 18 transactions.
South Africa topped the list with $23.7 billion from 15 transactions, followed by Angola ($15.8 billion), Côte d’Ivoire ($15 billion), Ghana ($12.6 billion), and Kenya ($12.2 billion). Collectively, 13 sub-Saharan African countries face Eurobond principal repayments totaling $43.6 billion between 2024 and 2030.
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Regional Financial Obligations
South Africa leads with $11.8 billion in repayments, while Ghana and Nigeria each face $6.4 billion. Angola, Kenya, Côte d’Ivoire, and Zambia are obligated to repay $3.9 billion, $3.2 billion, $2.8 billion, and $2.2 billion, respectively. Nigeria’s share constitutes approximately 14.7 percent of the region’s total Eurobond repayment obligations.
However, the primary concern is the escalating cost of refinancing these debts. Since 2022, global monetary tightening has significantly increased the cost for African governments to access international capital markets. Despite some recovery in market access by 2024, borrowing costs remain considerably higher than pre-tightening levels.
Refinancing Costs
In 2024, Nigeria issued Eurobonds with coupons of 9.6 percent and 10.4 percent, approximately 300 basis points higher than similar Nigerian bonds issued in 2021. Across the region, bonds issued during the 2024 market reopening had yields between 7.1 percent and 10.4 percent, roughly 300 to 500 basis points above pre-2022 levels.
The World Bank acknowledges that refinancing can mitigate short-term rollover risks but warns it commits governments to higher debt-servicing costs for extended periods, reducing funds available for other priorities. This issue is exacerbated by the shorter maturities of new Eurobonds.
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Many bonds issued between 2024 and 2026 mature in just five to six years, compared to the 10- to 12-year terms common before the COVID-19 pandemic. African governments are increasingly opting for refinancing over relying solely on budget revenues to repay maturing Eurobonds.
For instance, Kenya refinanced a significant portion of a $2 billion Eurobond maturing in 2024 by issuing a new $1.5 billion bond, supplemented by budget funds. However, the new bond carried a 10.4 percent yield, compared to the 6.9 percent coupon of the maturing bond.
The World Bank notes that since 2021, public and publicly guaranteed external debt service in sub-Saharan Africa has remained high, at around 1.6 to 1.7 percent of GDP. Increasing interest and principal payments are diverting resources that could otherwise fund infrastructure, human capital, and social protection. This shift means debt management is becoming a critical fiscal allocation issue, as every dollar allocated to servicing more expensive external debt is a dollar not available for investment and public services.
