The G20 Sum- mit convened in Johannesburg on 22–23 November 2025, marked the first time that the African Union (AU), represented by a new leader, João Lourenço, President of the Republic of Angola, attends as a perma- nent member at a forum that is hosted on African soil.

This coincidence of leader- ship and geography offers a moment for Africa to reimag- ine its role in the global finan- cial system and to articulate a bold new vision for prosperity that also addresses the struc- tural barriers holding the con- tinent back.

South Africa’s presidency will revolve around the theme ‘Solidarity, Equality, Sustain- ability’, focusing on inclusive partnerships and delivering the 2030 Agenda for Sustain- able Development.

Yet, alongside that agenda, the AU should present an al- ternative – one that directly tackles the financial con- straints that consistently stifle African growth. Four of these are particularly urgent: the fi- nancing gap for small and me- dium-sized enterprises (SMEs), unsustainable external debt, punitive credit-rating regimes and currency volatility.

Let’s see how this impacts the economies and livelihoods of ordinary Africans. In the DRC for instance, the IFC es- timates an SME financing gap of $6.8bn, nearly a fifth of GDP.

Across the continent, lim- ited access to affordable capital keeps small businesses – the real engines of employment and innovation – from ex- panding. Meanwhile, debt ser- vicing takes up to 40% of pub- lic revenues in several African countries, draining resources from vital services.

Credit ratings impose yet another constraint. As Claver Gatete of the UN Economic Commission for Africa ob- serves, the gulf in borrowing costs is staggering: Germany can raise a $1bn ten-year loan at just $229m interest, while Zambia would pay $2.25bn in interest for the same amount, because of its ‘junk’ status.

Currency volatility and in- flation further erode hard-won gains, while capital continually escapes to safer havens. Per- haps a fifth challenge lies in financial inclusion. Fewer than 43% of adults in Africa, south of the Sahara, hold an account with a formal institution.

At the same time, a not-so- quiet revolution is reshaping global finance. The rise of de- dollarisation, crypto assets and gold-linked trade systems through frameworks such as BRICS reflect a shifting eco- nomic order.

We know Africa is not standing still: the Pan-Afri- can Payment and Settlement System (PAPSS) – launched by the AU and Afreximbank – al- ready enables intra-African trade to be settled in local currencies. Cryptos and sta- ble coins could, in principle, extend financial reach beyond traditional banks, but as many African countries carry heavy dollar-denominated debt, a sudden pivot away from the dollar would threaten bal- ance sheets, not to mention the risks of poorly regulated crypto markets.

Concerted action needed

Perhaps the most decisive pro- gress Africa can make dur- ing and following the G20 is to begin a process of serious institutional alignment.

The AU, the African Devel- opment Bank (AfDB), Afrex- imbank, and the African Continental Free Trade Area (AfCFTA) each play vital roles – setting strategy, financing infrastructure, and facilitating trade. Yet despite shared ob- jectives, they seldom operate in full concert.

The AU’s 37th Summit called for reforms to the global financial architecture and for greater African influence in global decision-making, but implementation is hampered by fragmented mandates, overlapping projects, and in- consistent priorities.

A 2025 Afrobarometer sur- vey found that 71% of Africans believe their countries should wield more influence in in- ternational institutions; the perception of disunity under- mines that aspiration.

To change this, Africa could establish an explicit African Financial Compact (AFC) – a formal mechanism binding together AU policy, AfDB cap- ital, Afreximbank trade in- struments, and AfCFTA market access under one coordinated framework. AFC might ini- tially pursue my three over- riding priorities:

Reparatory debt justice and global finance reform: Debt-for-climate and historic reparations swaps, realloca- tion of Special Drawing Rights (SDRs), and reforms to curb predatory lending, providing governments with breathing space for investment.

Capital for SMEs and youth innovation:

A G20-backed blended-finance facility to expand credit for youth and women-led en- terprises, complemented by diaspora bonds and impact- investment vehicles. SMEs ac- count for around 80% of jobs in Africa; unlocking their po- tential would transform live- lihoods.

Infrastructure and continental integration: Build on AfCFTA and PAPSS by inviting G20 and multilat- eral partners to co-invest in power, broadband, and trans- port through public-private partnerships and concessional finance.

If created, AFC, will of course, set its own priorities. But the Johannesburg G20 Summit can be used as a his- toric stage for the launch of Africa’s own economic narra- tive and enhanced compact. n

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