Africa Is Done Paying A Premium For A Story That Isn't True

ONE Campaign calls on world leaders to end the global finance system that makes Africa pay more because the world sees it as less

As the G20 gathers in South Africa this week, the ONE Campaign is issuing a direct challenge to world leaders: stop making Africa pay more because the world sees it as less. Africa faces the highest cost of capital in the world, not because of weak fundamentals, but because of outdated assumptions, opaque risk assessments and decades of structural bias. For too long, Africa has been burdened by a financial architecture that penalises its potential instead of recognising its performance.

This imbalance is not academic. It is costing African countries tens of billions of dollars every year and squeezing development budgets at a time of rising global shocks. Official development assistance plummeted by 7.1% in 2024, with projections pointing to deeper cuts ahead. In response, many African governments turned to capital markets between 2016 and 2021, only to find themselves paying an extra

$56 billion in interest compared to what they would have paid under concessional lending terms. That figure eclipses the continent’s total foreign direct investment in 2023, illustrating just how profoundly the system is stacked against African borrowers.

At the centre of the crisis sits the “African risk premium.” Despite decades of strong investment performance, including infrastructure returns that have outpaced the SCP 500 sixfold, African countries are still charged some of the highest interest rates in the world. These inflated rates are shaped not only by economic factors but by subjective credit ratings and stereotypical global narratives. It is within this context that the G20 arrives in Johannesburg, and the stakes could not be higher. This moment demands conviction, clarity, courage and action.

Serah Makka, Africa Executive Director at the ONE Campaign, highlighted the urgent need for decisive action: “This is not about spreadsheets, it is about human lives. When countries pay inflated interest rates driven by outdated perceptions, they are forced to choose between paying creditors or paying teachers, nurses and engineers. Nearly three-in-five Africans now live in countries spending more on interest than on health or education. Africa is not alone: 3.4 billion people globally face the same distortion. This is a systemic failure. As the G20 meets on the continent, the world must say clearly that the era of pricing Africa on bias must end. Lowering the cost of capital is not charity; it is smart economics, and it is in the world’s collective interest.”

The G20 has the power and responsibility to lead an economic reset. ONE is calling for an ambitious implementation roadmap that overhauls how countries’ risk is assessed, accelerates transparency in economic data, expands the use of innovative finance tools that reduce risk, meaningfully includes African voices in global financial rulemaking and ensures concessional finance reaches the countries that need it most. This Summit is not just another meeting. It is a turning point, and the world will be watching to see what choices the leaders will make.

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