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Banks Warn Debt Forgiveness Will Hurt, Not Help, Africa

  • Nations hampered by virus seek debt relief to revive economies
  • Covid-19 has become a boon for digital payments on continent
Kenyan Retail Economy Inside a Nakumatt Holdings Ltd. Store

Photographer: Riccardo Gangale/Bloomberg

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Scrapping the debt of heavily indebted African nations will only come back to haunt them, according to two of the continent’s largest banks.

“Forgiveness is not helpful because your debt is somebody’s else’s savings,” Ade Ayeyemi, chief executive officer of Lome, Togo-based Ecobank Transnational Inc., said in an interview at the Bloomberg Invest Global virtual conference on Monday. “When you go to the market to borrow money, the market is looking at your current and past behavior.”