As development aid continues to shrink and debt burdens rise, experts have called for urgent reforms to the global financial system to protect Africa’s economic future. They made the call during a high-level dialogue held on the sidelines of the African Development Bank (AfDB) Group’s 2025 Annual Meetings on May 28, in Abidjan, Côte d’Ivoire. Claver Gatete, Executive Secretary of the United Nations Economic Commission for Africa (UNECA), warned that diminishing aid flows could severely undermine Africa’s growth prospects. “Aid will continue to decline until it contributes very little,” Gatete said. “We are seeing high debt levels globally, and the impact on our development is significant.” He emphasised that implementing the African Continental Free Trade Area (AfCFTA) is essential to unlocking regional growth, but governments cannot do it alone. ALSO READ: Tariff crisis an opportunity for boosting intra-African trade, says AfCFTA’s Mene “We need the private sector to step in. For that to happen, we must establish strong African financial institutions,” he noted. Gatete also stressed the need for a more inclusive global financial architecture that considers the realities of developing economies. “Many finance ministers are expected to maintain macroeconomic stability, manage high debt, and still invest in development. But the cost of borrowing remains prohibitively high. That’s why Africa must remain central to the global financial reform agenda.” Admassu Tadesse, President of the Eastern and Southern African Trade and Development Bank (TDB) Group, echoed Gatete’s concerns, noting that access to long-term finance has always been a challenge. “Commercial banks are not designed for long-term lending. That’s why we need specialised institutions,” he said. Tadesse added that international regulatory changes are quietly pushing global banks out of African markets. “Many global banks that once supported African trade and commercial finance are retreating—not due to aid cuts, but because of harmful regulatory practices that are quietly cutting African institutions off from the global financial system.” ALSO READ: Africa’s sustainable development hinged on effective financial markets, says ECA’s Gatete Despite progress in establishing pan-African institutions like the African Export–Import Bank (Afreximbank) and TDB, Tadesse warned that they, too, are now being affected by the very global systems that were meant to foster development. “These African Development Finance Institutions (DFIs) often enjoy better credit ratings than many sovereigns. They've helped reduce risk premiums, yet they now face barriers that threaten their global operations.” Hassatou Diop N’Sele, Vice President for Finance and Chief Financial Officer at the AfDB, acknowledged the bank’s longstanding support for African DFIs but said more support is needed. “We are exploring ways to channel Special Drawing Rights (SDRs) to Multilateral Development Banks—not just to increase our lending capacity, but also to provide capital and de-risking tools to African DFIs,” she said. N’Sele also emphasised the need for stronger domestic resource mobilisation and the development of local currency capital markets to reduce dependence on external borrowing. “Why should we raise money in dollars in Europe? The U.S. borrows in dollars at home—and so should we. Our capital markets lack depth, and that must change,” she added. Nigeria’s Minister of Finance, Adebayo Olawale Edun, urged African nations to adopt a mindset of self-reliance, especially in response to evolving global trade policies such as new reciprocal tariff regimes. “We can't expect someone else to take care of us. The U.S. decision was a wake-up call. We must trade more among ourselves and harness the liquidity we already have. Let’s build a culture of self-reliance and strengthen our regional blocs,” he said.
