The Alliance of African Multilateral Financial Institutions (AAMFI) has launched an early warning system to detect the first signs of sovereign debt distress in African countries, aiming to prevent future disputes and facilitate timely interventions. The initiative, announced on January 29, brings together seven regional institutions, including Africa Finance Corporation, Afreximbank, and the Trade and Development Bank, among others, to provide collective support and design instruments to ease stressed debt situations.
This move follows recent controversies during the debt restructuring of Ghana and Zambia, where disputes arose over preferred creditor status and the treatment of loans held by multilateral institutions.
The early warning system comes amid rising debt risks across the continent, with recent reports identifying several countries in debt distress or at high risk, including Ghana, Malawi, Mozambique, Kenya, and Zimbabwe, underscoring the need for proactive monitoring and coordinated responses to maintain financial stability in Africa.
