By Milliam Murigi| milliammurigi@gmail.com
African countries struggling to cope with droughts, floods and other climate shocks could free up resources for climate resilience if creditors cancelled unsustainable debt, according to a new report by ActionAid International.
The report, Debt Fuels the Climate Crisis: How the Finance Flows, finds that the 65 most climate-vulnerable countries analysed are spending nearly 25 times more on debt repayments than on climate action, leaving governments with fewer resources to prepare communities for worsening climate impacts.
Speaking during a virtual meeting organised by Media for Environment, Science, Health and Agriculture (MESHA), Teresa Anderson, Global Climate Lead at ActionAid said that debt servicing consumes about 65 per cent of the combined government revenue of these countries. With 93.5 per cent of the countries assessed either in debt distress or at significant risk of it.
“Cancelling unsustainable debt could release money for investments in climate adaptation, health, education and social protection instead of governments directing much of their revenue towards repayments,” she said.
The findings highlight the financial constraints facing countries that need to strengthen their resilience to climate change but have limited room in their budgets to do so. According to the report, cancelling debt in climate-vulnerable countries could finance their basic, unconditional national climate plans six times over. The resources could also cover their existing combined expenditure on climate action, health, education and social protection twice over.
Debt relief could also give governments greater flexibility to invest in measures such as irrigation, drought preparedness, early-warning systems, climate-resilient agriculture and infrastructure designed to withstand extreme weather.
“Debt is a major, but fixable, barrier to climate action,” she said, arguing that debt cancellation could be one of the most impactful ways to unlock domestic resources for climate resilience.
According to the report, debt repayments are squeezing climate spending. For example In Zambia, debt repayments consume more than 60 per cent of the government budget and 70 per cent of tax revenue, while climate activities account for just 0.32 per cent of government expenditure.
Malawi faces a similar squeeze, with debt repayments consuming 70 per cent of its national budget in 2026, equivalent to 129 per cent of government revenue. In Senegal, debt servicing is more than 600 times the country’s budgeted spending on climate action, while Mozambique spends 117 times more on debt repayments than on climate action.
The findings according to Anderson raise concerns about how governments can finance measures to protect communities against droughts, floods and other extreme weather events when a large share of their resources is committed to servicing existing debts.
“For farmers, inadequate investment in irrigation, water conservation, climate-resilient crops and early-warning systems can leave livelihoods and food production more exposed to changing weather patterns. ActionAid argues that debt cancellation could give vulnerable countries greater fiscal room to invest in these measures before disasters strike, rather than relying heavily on emergency responses after losses have occurred.”
Although the country comparisons above do not establish Kenya’s position relative to the countries analysed, the financing challenge is relevant to Kenya, where the government must balance debt obligations against the need to invest in climate adaptation.
An analysis by the Institute of Public Finance published in June 2026 estimated that Kenya requires approximately Sh468.5 billion annually for climate adaptation under its nationally determined contribution, with 10 per cent expected to come from domestic government resources.
The analysis also raised concerns about the adequacy of adaptation funding across sectors such as agriculture, environment and water, highlighting the challenge of sustaining long-term climate investments. Kenya’s Public Debt Management Office reported public debt of Sh12.32 trillion as of March 2026, illustrating the scale of the government’s financial obligations.
“Debt relief, if secured, could provide additional room for climate investment. But there will be a need to establish how much could realistically be released, which obligations could be cancelled and how the savings could be directed towards adaptation,” she added. According to Anderson, there is need for the cancellation of external debt especially for climate-vulnerable countries spending more than 10 per cent of their budgets on external debt servicing. Apart from that there is also need for automatic suspension of debt-service payments for at least five years following a climate disaster, alongside increased climate finance in the form of grants rather than additional loans. The organisation further supports reforming the international debt system to give developing countries a fairer role in decisions affecting their borrowing and repayment obligations.
