Explaining African Participation in the G20 Common Framework for Debt Treatments

• In Event: Development and External Dependence

Abstract

What does the current impasse around the global governance of sovereign debt tell us about the effects of international financial diversification on the agency of peripheral states in the international political economy? To address this question, this paper examines the drivers of African governments’ participation in the G20 Common Framework for Debt Treatments. Almost half of all low-income countries are at acute risk of, or already in, debt distress- the majority of these are in Africa. While most African sovereigns have shunned the G20 initiative, four African states have nonetheless signed up to the Common Framework, including non-defaulting Chad and Ethiopia.

We argue that the determinants of African participation can be explained by analyzing debt policy as concerned with more than financial considerations and crucially also evincing strategic foreign policy rationales. We demonstrate that motivations for (not) joining the Common Framework are complex and as much political as they are economic: they reflect attempts to consolidate ties with the geopolitical West following excessive exposure to non-traditional lenders but also serve the long-term purpose of strengthening state sovereignty and maximizing weak polities’ room to manoeuvre amidst shifting regional security dilemmas.

We support this argument through an empirical analysis of decision-making in Angola, Cape Verde, Chad, and Ethiopia, drawing on elite interviews with senior decision-makers and other key informers, conducted through both project-specific and long-term fieldwork. By approaching debt policy through the prism of African states’ strategic calculus to enhance their sovereignty, this paper brings together important qualitative primary data with insights from the rich scholarship on African governments’ decision-making to shed light on underexplored aspects of sovereign debt governance. Conversely, we also foreground the foreign policy dimensions of African economic policy, which have been underemphasized in the Africanist literature.

Authors

• Nicolas Lippolis, Columbia University

• Harry Verhoeven, Columbia University