Sub-Saharan Africa’s two biggest economies, Nigeria and South Africa, are both facing slow-burning debt problems. In Nigeria at least, elections on Saturday offer an opportunity to shift towards greater fiscal discipline – especially if opposition candidates Peter Obi (of the Labour Party) or Atiku Abubakar (of the Peoples Democratic Party) secure the presidency. But Nigeria’s fiscal outlook would probably remain on a deteriorating trajectory were the ruling All Progressives Congress party to remain in power under the leadership of Bola Tinubu. Meanwhile in South Africa, policymakers have refrained from giving into calls to provide more support and instead stuck to fiscal consolidation in the budget unveiled this month. That said, it wouldn’t take much to slip from the very narrow path for stabilising public debt, not least because political pressures for higher spending will only grow ahead of the 2024 elections.
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