LONDON: PROMINENT Tanzanian businessman, Mr Rostam Aziz has urged major global lenders to reduce interest rates on loans for African countries, aligning them with rates offered in Europe, the United States and Asia.
Speaking at a Financial Times Africa Summit roundtable in London yesterday, Mr Rostam highlighted the need for fairer lending terms for Africa.
The two-day event, held on October 29-30, drew influential figures including heads of state, central bank governors from across Africa, British ministers and representatives from the IMF, World Bank, United Nations and major financial institutions, solidifying its role as a premier forum for African investment strategies.
During his remarks, Mr Rostam emphasised that African countries demonstrate low default rates, yet still face disproportionately high interest rates.
Citing 2021 data, he noted that of approximately 800 global companies offering loans, the default rate for African nations remained below two per cent, in contrast to over five per cent in Europe, nearly 12 per cent in Latin America, and around six per cent in the United States.
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Despite this favourable record, Africa, he argued, continues to be ‘unfairly penalised’ with elevated interest rates an issue he described as deeply troubling.
He called on G7 countries to implement policies requiring banks to designate a specific quota of funds for African loans to ensure equitable financing access for the continent.
“Africa needs fair and affordable access to large-scale funding to meet its development needs,” Mr Rostam said.
Mr Rostam also criticised credit rating agencies, which he accused of assigning disproportionately low ratings to African nations compared to Latin American counterparts, even when economic fundamentals are similar.
He pointed out that countries like the Philippines and Iraq secure lower interest rates than Botswana, despite Botswana’s investmentgrade status.
This pattern of ‘misrating and mispricing’ by global financial entities, Mr Rostam contended, demands urgent redress to eliminate the unfair financial burdens placed on African economies.