The African Development Bank (AfDB) has revealed that Africa loses more than $580 billion each year to corruption and illicit financial outflows, a drain that continues to hinder economic growth and exacerbate the continent’s debt challenges.
AfDB President Akinwumi Adesina made the disclosure in a Bloomberg interview, warning that these losses are so significant they surpass Africa’s capacity to fund infrastructure and development projects, even as total continental debt approaches $2 trillion.
“It doesn’t matter how much water you pour into a bucket if the bucket is leaking. By reducing leakages from illicit capital and corruption, Africa can retain more resources to fund the infrastructure it needs,” Adesina said.
$1.6 Billion Lost Daily
According to the AfDB, Africa loses roughly $1.6 billion daily to “financial leakages.” This includes $90 billion annually in illicit financial flows, $275 billion lost through profit-shifting by multinational corporations, and $148 billion siphoned off due to corruption.
These losses occur amid an infrastructure financing gap of up to $170 billion annually, a shortfall critical to unlocking economic growth and creating jobs for Africa’s youthful population. Instead, many governments are overwhelmed by rising debt-service costs.
A joint study by Boston University’s Global Development Policy Center and the Institute for Economic Justice found that debt servicing in Africa has reached its highest level since the early 2000s debt crisis, with more than half of African governments now spending more on interest payments than on public healthcare.
While access to concessional financing and debt restructuring remain important, Adesina stressed that tackling corruption and illicit outflows is the most vital step to protecting Africa’s resources and reducing dependency on debt.
Context from AfDB’s 2025 African Economic Outlook
The AfDB’s 2025 African Economic Outlook highlighted that some countries are projected to spend up to 75% of their revenues on interest payments this year. The Bank noted that even countries with low debt-to-GDP ratios may face high debt burdens if large portions of revenue are allocated to debt service.
While several African countries experienced declining debt levels in 2022–2023 due to favourable interest-growth differentials, the Bank cautioned that this progress is fragile. A slowdown in economic growth, rising interest rates, reckless fiscal practices, or excessive commercial borrowing could quickly reverse gains.
