Welcome to Foreign Policy’s Africa Brief.
The highlights this week: Ethiopia reaches a milestone in its debt relief process, the United States sanctions a major Rwandan gold refinery, and Cape Verde makes history at the FIFA World Cup.
After a tumultuous five-year struggle, there are signs that Ethiopia’s debt relief process may finally be nearing its end. On Monday, Addis Ababa announced that it had reached a preliminary deal to restructure its defaulted $1 billion international bond after private creditors threatened to sue the Ethiopian government in U.K. courts.
The restructuring has become a test case for the Group of 20’s Common Framework, which is designed to help developing nations unify debt negotiations among traditional Western creditors, non-Paris Club ones such as China, and private lenders.
Although Ethiopia’s debt relief process may be settled, it has highlighted divisions between sovereign creditors and private lenders as the two have argued over how to split financial losses—tensions that threatened to derail the steady growth that Ethiopia has seen in recent years.
In 2021, Ethiopia became one of four African nations to request a debt restructuring under the G-20 Common Framework amid a two-year civil war in the country’s Tigray region. It sought to restructure at least $13 billion in external loans.
No agreements had been made by December 2023, when the economic impact of the civil war led to a $33 million missed payment and Addis Ababa’s subsequent default on the $1 billion bond one year before it was due to be paid back in full.
After four years, Ethiopia reached a final agreement with foreign governments last July on restructuring $8.4 billion of bilateral loans, with $3.5 billion in debt relief. But a deal on the $1 billion bond held by private lenders has proved to be more elusive.
Ethiopia reached a preliminary agreement with the private holders of the Eurobond in January, but it was blocked by official bilateral lenders, led by China and France, who argued that the terms were too favorable to the private investors and insisted that they take similar losses to those accepted by sovereign governments.
In April, Private bondholders threatened to sue Ethiopia, and they rejected a new proposal by the country the following month.
The new deal still gives bondholders considerably more money than government creditors—and more than what was on the table in May, said Tim Jones, the policy director of Debt Justice, a U.K.-based organization. Private creditors have “threatened to sue or said they’re actually suing Ethiopia in U.K. courts four times,” he said.
Jones argues that legislation is needed to deter creditors from using lawsuits during the debt relief process to achieve more favorable outcomes. “These debts are governed by English law, so the U.K.,” which holds the G-20 presidency next year, “has the power to do that,” he said.
Critics argue the nominal debt relief achieved through the convoluted process has stopped more African nations from signing up for the G-20 Common Framework. Most countries on the continent are spending more on servicing foreign debt than on healthcare.
“The Common Framework has largely failed; it’s been too slow, private creditors have been able to hold up the process in all cases and demand higher payments, and countries are being left with too high a debt at the end of it,” said Jones.
There are still divisions between bilateral and private lenders. But for now, Ethiopia’s process can move forward.
Under the new deal, bondholders have agreed to reduce the $1 billion debt by 12 percent to $880 million, repaid in installments by 2029 with an interest rate of 6.15 percent, down from the original 6.25 percent. Private investors will also have the right to buy new Eurobonds issued by Ethiopia of up to $1 billion—and if Addis Ababa does not go through with the bond issue, then it will have to pay investors up to $90 million.
Still, finalizing the debt restructuring is a boon to Prime Minister Abiy Ahmed’s overall economic agenda. Since he took office in 2018, Abiy has sought to liberalize the Ethiopian economy, a process that relies heavily on more international cash.
Abiy’s government has floated the birr, Ethiopia’s currency, and opened up key industries to foreign competition. Recent economic growth in the country has been driven by surging gold exports and diversification of its coffee exports, which have targeted Asian and Gulf markets—particularly China.
Washington appears to support Abiy’s economic program. The United States’ relationship with Ethiopia soured during the Tigray war but is thawing under the Trump administration. U.S. and Ethiopian officials met in April to discuss bilateral cooperation, and U.S. Secretary of State Marco Rubio and his Ethiopian counterpart, Gedion Timothewos, held further talks in May.
On Monday, Ethiopia also signed an around $91.2 million support package with Italy, comprising concessional loans and grants to support renewable energy and agriculture programs. The renewed engagement is part of Italian Prime Minister Giorgia Meloni’s strategy to create business opportunities for Italian energy companies while limiting the economic drivers of African migration to Europe.
Monday, June 29, to Friday, July 3: Finance ministers from the Southern African Development Community hold a meeting in Harare, Zimbabwe.
Thursday, July 2: Algeria holds parliamentary elections.
Wednesday, July 8: Protests are scheduled to take place in the Democratic Republic of the Congo over a bill to change the constitution. The government has banned the demonstrations.
Sudan’s civil war. The United Nations Human Rights Council will hold an urgent debate on Friday on the situation in Sudan’s El Obeid region, following an official request from Sudanese rights organizations and several governments, including Germany and the United Kingdom.
The U.N. and security experts warned last week that the Rapid Support Forces (RSF) could carry out mass atrocities on El Obeid in Sudan’s North Kordofan state as it prepares a siege on the city. El Obeid is held by the Sudanese military, which has fought the RSF for control of the country since the civil war began in 2023.
An RSF assault last year on El Fasher, a city in the Darfur region, bore “hallmarks of genocide,” according to the United Nations.
U.S. sanctions. On Thursday, the United States imposed sanctions on Rwanda’s Gasabo Gold Refinery and two of the company’s executives, accusing them of smuggling minerals from areas controlled by Rwanda-backed M23 rebels in the neighboring Democratic Republic of the Congo.
The Trump administration aims to leverage these sanctions to clean up supply chains in the wake of a critical minerals deal that it signed last year with Congo to boost private U.S. investment in the country’s mining sector. Meanwhile, Congo filed an International Court of Justice case against Rwanda last week over its role in the decades-long conflict in eastern Congo.
Education control. Last week, Burkina Faso’s military government announced that it will require all students seeking higher education overseas to obtain prior authorization from the Ministry of Higher Education before departure.
The Burkinabe government said that the new process will help align overseas training with national development priorities—including those related to engineering, agriculture, and technology—and improve graduate reintegration into the local labor market. Burkina Faso will no longer recognize unapproved degrees.
Former colonial power France is the top destination for Burkinabe students, and the move is seen as a way to further reduce French influence in the country. Ouagadougou severed diplomatic relations with Paris on Friday, citing alleged French support “for subversive networks” and “terrorists.”
Kenya protests. More than 350 people were arrested during nationwide protests in Kenya last week, which marked the second anniversary of youth-led protests in 2024, when dozens of Kenyans were killed by police. Protesters demanded a credible investigation into past police abuse.
Earlier this month, the Kenyan government agreed to pay compensation to nearly 2,000 protest victims, but President William Ruto said that this was an acknowledgement of harm rather than an admission of guilt.
As his popularity has steadily eroded, Ruto is seeking new voter bases in the north, particularly among the country’s Somali community. “Ruto is likely to step up his outreach to northern Kenya between now and the August 2027 election,” Joseph Maina wrote last week in Foreign Policy. “This could mean more development promises, extra cabinet posts for Somali leaders, and faster work on big projects.”
Cape Verde made history this week by becoming the smallest country ever to reach the knockout stage at the FIFA Men’s World Cup. The tiny island nation off the coast of West Africa, which has a population of a little more than 500,000 people, has punched above its weight throughout the tournament, achieving draws against former champions Spain and Uruguay.
It’s an underdog story that has drawn the support of millions of people globally and given international visibility to a nation that is heavily reliant on tourism.
“We are small, but we have big hearts, and we are fighters,” said Cape Verde’s goalkeeper, Josimar José Évora Dias, known as Vozinha. The Blue Sharks, as the national team is called, will face three-time champions Argentina on Friday.
Nine of the 10 African teams at this year’s expanded tournament reached the knockout stage, showcasing African talent and rising success in the sport.
Ghana’s drainage project. In the Fourth Estate, Gabriel Jackson Ocloo reports on an abandoned $14 million World Bank-funded drainage project in Ghana that was supposed to reduce flood risks in vulnerable parts of Greater Accra, but has instead become an obstruction to flowing water that could even worsen flooding.
The project, which began in early 2024, faced delays due to compliance and payment issues.
Around $10 million was released to contractors to speed up the work, but according to residents, “there is little publicly accessible information explaining how the money has been used.”
Algeria’s shrinking public space. In Africa Is a Country, Maher Mezahi argues that soccer arenas are one of the few places left for Algerians to publicly gather and voice their political opinions amid rising surveillance and state repression.
Yet Algerian President Abdelmadjid Tebboune’s government has started to transform this culture. In recent years, it has erected several state-of-the-art stadiums, where “authorities now have the names and contact details of everyone sitting in a given section,” Mezahi writes.
But, he adds, “[i]f, as history suggests, the stadium and the street influence one another, then a bottom-up reimagining of stadium culture is within reach.”
