BY BUSINESS EDITOR
MBABANE – Eswatini is in a better position to accelerate the economy as the country has been enlisted among the top ten countries with the lowest debt to the International Monetary Fund (IMF).
The International Monetary Fund is a major financial agency of the United Nations, and an international financial institution funded by 190 member countries, with headquarters in Washington, D.C.
Countries with lower debt levels are better positioned to maintain economic stability. High debt can lead to financial crises, currency devaluation, and inflationary pressures, just to mention a few.
African countries can reduce the risks associated with borrowing from abroad and strive towards establishing a stable economic climate that supports sustained growth by taking a cautious approach to borrowing.
A nation’s general economic well-being can benefit from maintaining a low debt load, and some African nations have done well at this, particularly with regard to particular lenders.
One significant player in international finance is the International Monetary Fund (IMF), which lends money to nations that are having financial difficulties.
IMF loans, however, may have a variety of effects on the country’s economy. Some African regions experience these impacts to a far lesser extent than others because of the small amount of loans that these governments have obtained from the global lender.
Typically as a last resort, countries often turn to the IMF in times of economic crisis to stabilize their financial systems. These loans help cushion the economic adversities said countries may be going through.
The nation’s finances can also be strengthened with loans from the international financier until they are able to find a more long-term solution to their economic issues. Furthermore, an IMF loan can improve a nation’s reputation among international investors. Increased foreign direct investment and improved access to international capital markets could be the outcomes of this increase in trust.
However improper management or use of these loans could be detrimental to an economy. Apart from the fact that debts in general can be a source of financial strain in any economy since they are an expense that the nation bears responsibility for, IMF loans frequently have strict requirements attached to them, such as the implementation of austerity measures like raising taxes, reducing public spending, and cutting subsidies.
Even though the goal of these actions is to correct budgetary imbalances, they may also negatively impact vulnerable groups and cause social unrest. Additionally, these issues may affect the nation’s exchange rate, depreciating local currencies relative to their value.
Below are the 10 African countries with the lowest debts to the IMF, courtesy of the IMF’s official website. Also, the list captures the data as of the 6th of December 2023.
| Rank | Country | Debt amount (US$) | Debt amount (E) |
| 1. | Sao Tome & Principe | $24,816,432 | E469 030 564.80 |
| 2. | Djibouti | $31,800,000 | E601 020 000 |
| 3. | Lesotho | $31,995,000 | E604 705 500 |
| 4. | Guinea-Bissau | $41,073,400 | E776 287 260 |
| 5. | Cabo Verde | $50,720,000 | E958 608 000 |
| 6. | Equatorial Guinea | $76,537,000 | E14 46 549 300 |
| 7. | Eswatini | $78,500,000 | E1 483 650 000 |
| 8. | Gambia | $97,762,500 | E1 847 711 250 |
| 9. | Seychelles | $98,419,500 | E1 860 128 550 |
| 10. | Burundi | $103,100,000 | E1 948 590 000 |
