Africa’s poorest nations are increasingly caught between servicing high-cost debt and meeting the food needs of their populations, Bloomberg reports, highlighting a growing dilemma for policymakers.

Alvaro Lario, President of the International Fund for Agricultural Development, told Bloomberg in Dakar, Senegal, that the challenge lies not in accessing finance, but in choosing the right form. “Should we provide a 100 million US dollars grant or a 300 million US dollars concessional loan?” he said. Concessional loans, lent at below-market rates, offer relief but still add to debt burdens.

Many African countries are heavily indebted, with interest payments absorbing between 10 and 25 percent of national budgets, limiting investment in agriculture. Africa is home to 32 of the world’s 44 least-developed countries, many of which are struggling to balance fiscal pressures with the growing needs of their populations.

Claver Gatete, Executive Secretary of the United Nations Economic Commission for Africa, told Bloomberg that reversing these trends requires broadening access to finance and mobilising private-sector investment. “Domestic resources and private capital must lead the way,” he said, adding that targeted tax reforms and incentives could direct resources toward sustainable agri-food systems.

Agriculture accounts for roughly one-quarter of Africa’s gross domestic product, yet the continent imports about 75 billion US dollars of cereals annually. With over 60 percent of the world’s uncultivated arable land and abundant water resources, African nations have the potential to achieve food self-sufficiency.

Senegalese President Bassirou Diomaye Faye told Bloomberg that Africa now faces a “critical turning point,” citing external shocks including aid reductions, US trade tariffs, and the global impact of the war in Ukraine on food prices. To improve access to finance for farmers, his administration is expanding land ownership, allowing farmers to use property as collateral. “Banks don’t like to take risks, and there’s very little guarantee when financing a farmer who doesn’t own his land,” he said.