African governments will turn to unconventional ways to meet financing costs expected to reach almost $83 billion next year, the highest level since 2021, according to BMI. Sub-Saharan African nations typically plug their shortfalls through a mix of concessional financing, domestic securities, commercial eurobond issuances and, to a lesser extent, “unorthodox methods” including central bank financing, BMI, a unit of Fitch Solutions, wrote in a report. “While these options will still dominate, we expect novel instruments to become more commonplace in 2026,” the firm said. They include Sharia-compliant sukuk bonds to tap into domestic markets, sustainability-linked and ESG bonds for specific projects, and infrastructure-linked bonds and diaspora bonds, BMI wrote.
To hedge against foreign-exchange risk, more African countries are likely to issue foreign-currency debt in currencies other than the dollar…
