The Iran war is raising borrowing costs for African countries that are only just recovering from the post-pandemic shock that sent debt burdens soaring.
Research published Tuesday by ONE Data showed borrowing costs from the World Bank’s International Bank for Reconstruction and Development jumped to 5.2% in 2024 from 1.4% in 2020, as central banks lifted interest rates to quell surging inflation. Chinese lending rates for African countries rose to 5.7% from 2.5%.
The report acknowledged it was premature to judge the impact of the Iran war, “but for countries already carrying heavy debt burdens the risk is clear: They face another round of economic shocks before they can recover from the last round,” its authors wrote.
