The agency said countries across the region have largely weathered recent inflationary pressures, helping to stabilise public finances and improve debt sustainability.
As a result, governments are expected to face lower borrowing requirements and more manageable debt burdens over the next two years.
Growth outlook improves
Moody’s expects sub-Saharan Africa’s economies to grow by 4.3% in both 2026 and 2027, measured as a weighted average across the region.
The agency forecasts that governments’ gross borrowing needs, which include funding budget deficits and refinancing maturing debt, will decline to 11.2% of gross domestic product (GDP) by 2027 from a peak of 12.3% in 2025.
Public debt is also expected to stabilise, with total government debt projected to ease to 56.6% of GDP in 2027 from 62.4% in 2025.
Debt pressures remain
Despite the improved outlook, the ratings agency warned that high debt-servicing costs, weak government revenue collection and exposure to climate-related shocks continue to pose significant risks.
According to Moody’s, Zambia and Ethiopia are expected to record the largest reductions in debt levels over the forecast period. By contrast, Botswana, which has been affected by weak global diamond demand, and Gabon, where government spending remains elevated, are expected to see the sharpest increases in debt.
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The agency also flagged rising interest costs as a concern, noting that Kenya and Zambia are each projected to spend about 35% of government revenue on interest payments by 2027, the highest levels in the region.
Outlook backed by reform momentum
Only two of the 25 sub-Saharan African sovereigns rated by Moody’s, namely Botswana and Mauritius, currently hold investment-grade status, indicating relatively low credit risk.
Of the 25 countries assessed, eight carry positive outlooks: South Africa, Namibia, Angola, Nigeria, Togo, Ghana, the Republic of Congo and Zambia. Thirteen countries have stable outlooks, while Mauritius, Gabon, Mali and Senegal have negative outlooks.
Risks still loom
While the overall picture has improved, Moody’s cautioned that a prolonged resurgence in inflation, severe climate-related weather events or a sudden withdrawal of investor appetite for African sovereign bonds could quickly reverse recent gains.
The agency said maintaining reform momentum and strengthening public finances will be critical if countries are to sustain the improvements in creditworthiness and economic growth over the medium term.
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- Moody’s has upgraded its outlook for sub-Saharan Africa to positive due to economic reforms, resilient growth, stronger commodity prices, and improved access to financing.
- Moody’s expects sub-Saharan Africa's economies to grow by 4.3% in both 2026 and 2027, with government borrowing needs declining to 11.2% of GDP by 2027 from 12.3% in 2025.
- Total government debt in the region is projected to decrease to 56.6% of GDP in 2027 from 62.4% in 2025, though high debt-servicing costs and climate-related risks remain concerns.
- Zambia and Ethiopia are forecast to have the largest debt reductions, while Botswana and Gabon are expected to see the sharpest increases in debt due to economic challenges.
- Only Botswana and Mauritius hold investment-grade credit ratings among sub-Saharan African sovereigns, with eight countries maintaining positive outlooks and four countries having negative outlooks.
