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4 World Economic Forum January 2023 STATS Debt and debt sustainability Debt has come under the spotlight in the past 18 months. There is talk of debt distress and the recent default in Ghana has rattled markets. Debt to GDP is manageable by global metrics. However, debt servicing is a big issue not least because tax collection is so low. As a result debt servicing is taking up much of government spending, in some cases more than is being spent on education or health and eating into what the government can spend on capital investments. Nigeria is an interesting test case. Its fiscal burden of total interest payments, domestic and external combined, is by far the highest of the 10 African countries surveyed. At the same time, it had the third highest capital expenditure as a proportion of total revenue and grants in 2020. This unusual combination might suggest that Nigeria has unsustainable debt metrics. All 10 countries under our coverage posted budget deficits in 2020 although this was the year when the Covid-19 pandemic struck: revenue naturally slumped and governments around the world were under pressure to mitigate its impact. The Nigerian government spent a total (current and capital spending, and interest payments) more than three times its revenue inflows in 2020, which shows that it favours an expansionist fiscal stance (and that its revenue collection is pitiful). It can borrow domestically at manageable interest rates because it can tap demand from a large domestic institutional investor base, led by pension funds and mutuals. This is an advantage shared in varying degrees by South Africa, Côte d’Ivoire, Egypt and Kenya. Last year as much as 90% of South African public debt was domestic. South Africa $268.8bn Total public debt for selected countries, 2021 35% 30% 25% 29%29% 29%29% 20% 15% 10% 28%28% Total external debt service/total exports, 2020 (%) 26%26% 21%21% 20%20% 13%13% 13%13% 12%12% 5% 0% 200% 4%4% Egypt South Africa Kenya Ethiopia Côte d'Ivoire Tunisia Morocco Nigeria Ghana Botswana Fiscal strains 2020 (% total revenue and grants) 180% 160% 140% 120% 100% 80% 60% 40% 20% Current spending n Interest payments n Capital spending n ↑ more than two times ↑ more than two times 0% Nigeria Ghana Egypt Kenya South Africa Côte d'Ivoire Tunisia Morocco Ethiopia Botswana External debt in 2022 (% of GDP) $316.1bn Egypt $95.8bn Nigeria $58.8bn Ghana $3.3bn Botswana $72.6bn Kenya $73.3bn Tunisia Domestic debt $611.85bn $457.55bn External debt 29%29% 50 f GDP) o (% 2022 l Debt in Externa 40 30 20 10 $59.1bn Ethiopia $82.8bn Morocco Cote d'Ivoire $38.8bn 0 NigeriaEgypt South AfricaAlgeriaMoroccoAngolaKenyaGhanaSenegal
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January 2023 World Economic Forum 5 Trade, tourism and freight Tourist and passenger numbers appear to be recovering since 2020/21 but they are still well below pre-pandemic levels (see below). Freight numbers also bounced back in 2021 following the pandemic although, surprisingly, Nigeria’s went down. Following the US-Africa Summit where $55bn of deals were announced by the US government we can see that trade between the continent and the US is still below 2011 levels, at a time when the US was far more dependent on Africa (and especially Nigeria) for its supply of oil. The advent of fracking in America has now made it a top-three oil and gas producer. The US recently overtook Qatar as the biggest exporter of LNG, having amended its laws to allow it to export these fossil fuels. Tourism recovery in Africa for the first nine months of 2022 January International tourist arrivals in 2022 (million) 1.39 February 1.77 International tourist arrivals in 2019 (million) Year to Date Change (%) 4.34 4.04 -68 -56 $22bn $20bn $18bn $16bn $14bn $12bn $10bn $8bn $6bn $4bn $2bn US trade with Africa, 2021 US imports n US exports n South Africa Egypt Nigeria Morocco Algeria Ghana Libya Côte d'Ivoire Angola Tunisia 4500 4000 3500 2011 2016 US imports of crude oil and products - selected countries Opec n Non Opec n 2021 March April May June July August 2.31 2.47 2.83 3.4 5.06 4.57 4.43 4.63 4 4.75 6.41 6.14 -48 -47 -29 -28 -21 -24 3000 b/d 000 2500 2000 1500 i a A r a b i S a u d i g e r i a l g e r i a NA l a A n g o C a n a d a i c o M e x . i a R u s s i a A r a b i S a u d i g e r i a l g e r i a NA l a A n g o C a n a d a i c o M e x . i a R u s s i a A r a b i S a u d i g e r i a l g e r i a NA l a A n g o C a n a d a i c o M e x . i a R u s s September 3.53 4.61 -23 1000 Top 5 passenger countries in Africa in 2021 (domestic + international traffic) Egypt South Africa Morocco Nigeria Kenya Top 5 freight countries in Africa in 2021 (domestic + international traffic) Ethiopia South Africa Nigeria Egypt DRC 2021 Passengers % growth over 2020 13,300,037 9,336,709 8 ,597,411 6,337,619 3,198,052 43.5 16.6 41.2 46.4 49.1 2021 Freight (tonnes) % growth over 2020 47,972 49.3 44,250 37.7 14,004 -43.6 11 ,749 6,993 89.8 13.1 500 0 $260bn $240bn $220bn $200bn $180bn $160bn $140bn $120bn $100bn $80bn $60bn $40bn $20bn US and China, total trade with Africa since 2011 China US $0bn 2020 2019 2018 2017 2016 2015 2014 2013 2012 2011 2021

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January 2023 World Economic Forum 5

Trade, tourism and freight Tourist and passenger numbers appear to be recovering since 2020/21 but they are still well below pre-pandemic levels (see below). Freight numbers also bounced back in 2021 following the pandemic although, surprisingly, Nigeria’s went down.

Following the US-Africa Summit where $55bn of deals were announced by the US government we can see that trade between the continent and the US is still below 2011 levels, at a time when the US was far more dependent on Africa (and especially Nigeria) for its supply of oil. The advent of fracking in America has now made it a top-three oil and gas producer. The US recently overtook Qatar as the biggest exporter of LNG, having amended its laws to allow it to export these fossil fuels.

Tourism recovery in Africa for the first nine months of 2022

January

International tourist arrivals in 2022 (million)

1.39

February 1.77

International tourist arrivals in 2019 (million)

Year to Date Change (%)

4.34

4.04

-68

-56

$22bn

$20bn

$18bn

$16bn

$14bn

$12bn

$10bn

$8bn

$6bn

$4bn

$2bn

US trade with Africa, 2021

US imports n US exports n

South Africa Egypt

Nigeria

Morocco Algeria Ghana Libya

Côte d'Ivoire Angola

Tunisia

4500

4000

3500

2011

2016

US imports of crude oil and products - selected countries

Opec n Non Opec n

2021

March

April

May

June

July

August

2.31

2.47

2.83

3.4

5.06

4.57

4.43

4.63

4

4.75

6.41

6.14

-48

-47

-29

-28

-21

-24

3000

b/d

000

2500

2000

1500

i a

A r a b i

S a u d i g e r i a l g e r i a

NA

l a

A n g o

C a n a d a i c o

M e x

.

i a

R u s s i a

A r a b i

S a u d i g e r i a l g e r i a

NA

l a

A n g o

C a n a d a i c o

M e x

.

i a

R u s s i a

A r a b i

S a u d i g e r i a l g e r i a

NA

l a

A n g o

C a n a d a i c o

M e x

.

i a

R u s s

September 3.53

4.61

-23

1000

Top 5 passenger countries in Africa in 2021 (domestic + international traffic)

Egypt

South Africa

Morocco

Nigeria

Kenya

Top 5 freight countries in Africa in 2021 (domestic + international traffic)

Ethiopia

South Africa

Nigeria

Egypt

DRC

2021 Passengers % growth over 2020

13,300,037

9,336,709

8 ,597,411

6,337,619

3,198,052

43.5

16.6

41.2

46.4

49.1

2021 Freight (tonnes) % growth over 2020

47,972

49.3

44,250

37.7

14,004 -43.6

11 ,749

6,993

89.8

13.1

500

0

$260bn

$240bn

$220bn

$200bn

$180bn

$160bn

$140bn

$120bn

$100bn

$80bn

$60bn

$40bn

$20bn

US and China, total trade with Africa since 2011

China

US

$0bn

2020 2019 2018 2017 2016 2015 2014 2013 2012 2011

2021

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