African Debt: At Some Point, the Hole Becomes Just Too Big to Fill

Yasuyoshi CHIBA / AFP

The rapidly deteriorating financial crisis in Lebanon provides a grim preview to other developing countries of what happens when the bottom falls out of an economy. After the government defaulted on its debt last spring, conditions spiraled downwards to the point where month after month of triple-digit inflation is devouring what’s left of peoples’ savings.

Although the situation to date in Africa is not as dire, the International Monetary Fund’s Managing Director Kristalina Georgieva, wants you to know that unless something is done, and soon, countries across the continent could well face the same challenges as Lebanon.

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by Eric Olander

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