May 22, 2024No Comments

The year of Generative AI elections: reviewing risks and mitigations

Author: Piero Soave and Wesley Issey Romain - AI, Cyber Security & Space Team

The year 2024 is sure to be remembered when it comes to elections: first, never before have so many people around the world been called to cast their vote; second, these elections will be the first to take place in a world of widespread Generative Artificial Intelligence (GenAI). The combined impact of these two elements is likely to have a lasting impact on democracy. This article looks at how GenAI can influence the outcome of elections, reviews examples of risks from recent elections, and investigates possible mitigations.

The year of high-stakes elections

In over 70 elections throughout 2024, some 800mn voters will take to the ballots in India, 400mn in Europe, 200mn in the United States of America, and many more across Indonesia, Mexico, and South Africa1. In many cases, these elections will be polarized and will feature candidates from populist backgrounds. Previous electoral rounds have scarcely been an example of moderation, featuring instead accusations of foreign interference, and a deadly assault on the US Congress. Whoever wins the most votes will make decisions on topics as consequential as the US-EU relationships, the future of NATO, trade wars, the geopolitical equilibrium in the Middle East, Hindu-Muslim relationships, and more. With so much at stake, the risk of election interference warrants a closer look.

Enter GenAI

The launch of OpenAI’s ChatGPT at the end of 2022 brought GenAI to the mainstream. GenAI indicates an AI system that has the ability to create content in the form of text, audio or video. Having been popularized by ChatGPT, there are now thousands of applications readily available at minimal to no cost. These systems have been trained on billions of elements of text, sound or video, and are able to respond to a user query and create synthetic content in those formats. 

The existing legal and regulatory frameworks are poorly suited to mitigate the risks deriving from GenAI. Since the launch of ChatGPT, there have already been lawsuits related to intellectual property2, sanctions to corner-cutting lawyers3, egregious reinterpretations of historical facts4, as well as general concern about the bias inherent in these systems5. One specific problem related to GenAI is that of deepfakes, i.e. audio or video files that show people saying or doing things they never in fact said or did. This content is so realistic that it is all but impossible to determine whether what is in front of us is reality, or an artificial creation. The consequences are far-ranging, from the potential increase in financial and other fraud6, to the infringement of privacy and individual rights7. But it is in the domain of politics that deepfakes are particularly troubling. They can be used for a variety of bad purposes, from misleading voters about where, when and how they can vote, to spreading fake content from well recognizable public figures, to generating inflammatory messages that lead to violence8

GenAI and misinformation in elections

Misinformation is not a new phenomenon, and it certainly is older than artificial intelligence. However, technology can exacerbate and multiply its effects. By some accounts, “25% of tweets spread during the 2016 US presidential elections were fake or misleading”9. GenAI has the potential to turbocharge the creation of fake content, as this no longer requires sophisticated tools and expertise - anyone with an internet connection could do it. 

Examples of deepfake interference in the political process abound10, despite the relative young age of the technology. In what is perhaps the most consequential event to date, Gabon’s President Ali Bongo appeared in a 2019 video in good health, despite having recently suffered a stroke. The media started questioning the veracity of the video - which is still being debated - ultimately triggering an attempted coup11. Crucially, Schiff et al suggest that “the mere existence of deepfakes may allow for plausible claims of misinformation and lead to significant social and political harms, even when the authenticity of the content is disputed or disproved”12.

During Argentina’s 2023 presidential elections, both camps made extensive use of AI generated content. Ads featured clearly fake propaganda images of candidates as movie heroes, dystopian villains or zombies. In an actual deepfake video - labeled as AI generated - “Mr Milei explains how a market for human organs would work, something he has said philosophically fits in with his libertarian views”13. Also in 2023, synthetic content featured in mayoral elections14 in Toronto and Chicago, the Republican primaries in the US, Slovakia’s parliamentary elections - all the way to New Zealand15.

In the run-up to general elections in India, the Congress party shared a deepfake video of a Bharat Rashtra Samiti leader calling to vote for Congress. The video was shared on social media and messaging apps as voters went to the ballot, and was viewed over 500,000 times before the opposing campaign could contain the damage. AI is being widely used in India to create holograms of candidates, and translate speeches across multiple local languages - as well as for less ethical and transparent objectives16.

In an attempt to simulate bad actors’ attempt to generate misinformation, researchers tested four popular AI image generators and found that the tools “generated images constituting election disinformation in 41%” of cases. This is despite policies in place for these tools which should prevent the creation of misleading materials about elections. The same researchers looked for evidence of bad use and found that individuals “are already using the tool to generate content containing political figures, illustrating how AI image tools are already being used to produce content that could potentially be used to spread election disinformation”17.

Source: Markus Spiske. -

Controls and mitigations

Regulation around AI is moving fast in response to even faster technological advancements. Perhaps the most thorough attempt at creating a regulatory framework is the EU AI Act18, approved in March 2024. In the US, a mix of federal and state initiatives seek to address several concerns related to AI, from bias to GenAI, and data privacy. These include the 2023 Presidential Executive Order and related OMB guidance; the NIST Risk Management Framework; and state legislation, from the early New York City Law 144 to the more recent California guidance and proposed bills. Other countries, from Singapore to Australia and China, have approved similar rules. 

Looking at elections integrity specifically, the EU adopted in March a new regulation “on the transparency and targeting of political advertising, aimed at countering information manipulation and foreign interference in elections”. This focuses mostly on making political advertising clearly recognizable, but most of the provisions won’t enter into force before the autumn of 202519. Also in March, the European Commission leveraged the Digital Services Act - which required very large online platforms to mitigate the risks related to electoral processes - to issue guidelines aimed at protecting the June European Parliament elections. The guidelines include labeling of GenAI content. Although these are just best practices, the Commission can start formal proceedings under the Digital Services Act if it suspects a lack of compliance20. In the US, two separate bipartisan bills have been introduced in the Senate: the AI Transparency in Elections Act21 and the Protect Elections from Deceptive AI Act22.

These frameworks have yet to stand the test of time, and the proliferation of open-source models and APIs makes it an uphill struggle for regulators. Regulation around deepfakes specifically is scarce and complex, as it needs to address two separate issues: the creation of the synthetic material, and its distribution. What regulation does exist, tends to focus on sexual content23, although in some cases political content is also covered24. Existing norms around privacy, defamation or cybercrime can offer some support, but are ultimately inadequate to prevent harm25. Some tech solutions are available, such as watermarks, detection algorithms to verify authenticity, or including provenance tags into content26. Whether these techniques are able to prevent or counter the creation and spread of deepfakes at scale remains an open question - and some of them may have unintended drawbacks27. The experience of social media platforms in tackling the spread of harmful content and misinformation is mixed at best28. Platforms’ efforts to mitigate harm (from content moderation to the provision of trustworthy information), and solutions proposed by other parties (such as the removal of the reshare option) are steps in the right direction - but seem unlikely to move the needle.

It is possible that tech developments in the near future will make it easier to detect and disrupt the flow of disinformation, fake news and deepfakes that threaten to sway elections - such as the recently released OpenAI detector29. But the best tool available right now might be literacy interventions, which can make readers more alert to fake news3031. For example, news media literacy aims to provide the tools to assess information more critically and to identify false information. Hameleers found that this type of intervention is effective at reducing the perceived accuracy of false information, although importantly it does not reduce agreement with it (when the reader’s beliefs align with its message)32


2024 will be a critical year for liberal democracies and election processes worldwide, from the Americas and Europe to Africa and Asia. Election outcomes will play a crucial role in shaping the orientation of the most pressing issues in world affairs.

The advent of AI tools such as Generative AI threatens electoral processes in democratic countries as it increases the risks of disinformation, potentially swaying voting outcomes. GenAI effectively gives anyone the ability to create synthetic content and deploy it in the form of robocalls, phishing emails, realistic deepfake photography or video, and more. Once this content is online, previous experience teaches that it is very difficult to moderate or eliminate, especially on social media platforms.

While continuing to support tech-based initiatives to detect or tag synthetic content, Governments and education institutions should invest in information literacy programs to equip people with the tools to critically evaluate information and make informed electoral decisions. 

  1. Keating, Dave. “2024: the year democracy is voted out?” Gulf Stream Blues (blog). Substack. Dec 29, 2023.<> ↩︎
  2. Grynbaum, Michael M., and Ryan Mac. “The Times Sues OpenAI and Microsoft Over A.I. Use of Copyrighted Work.” New York Times. Dec 23, 2023. <↩︎
  3. Merken, Sara. “New York lawyers sanctioned for using fake ChatGPT cases in legal brief.” Reuters. June 26, 2023. <> ↩︎
  4. Grant, Nico. “Google Chatbot’s A.I. Image Put People of Color in Nazi-Era Uniforms.” New York Times. Feb 22, 2024. <> ↩︎
  5. Nicoletti, Leonardo., and Dina Bass. “Humans are Bias. Generative AI is even Worse.” Bloomberg. June 9, 2023. <> ↩︎
  6. Sheng, Ellen. “Generative AI financial scammers are getting very good at duping work email.” CNBC. Feb 14, 2024. < ↩︎
  7. Weatherbed, Jess. “Trolls have flooded X with graphic Taylor Swift AI fakes.” The Verge. Jan 25, 2024. <> ↩︎
  8. Alvarez, Michael R., Frederick Eberhardt., and Mitchell Linegar. “Generative AI and the Future of Elections” California Institute of Technology Center for Science, Society, and Public Policy (CSSP), July 21, 2023. <> ↩︎
  9. Bovet, Alexandre., and Hernán A. Makse. “Influence of fake news in Twitter during the 2016 US presidential election.” Nature Communications. Vol. 10(1), 7. Jan 2, 2017. <> ↩︎
  10. Bontcheva, Kalina., Symeon Papadopoulous., Filareti Tsalakanidou., Riccardo Gallotti., et al. “Generative AI and Disinformation: Recent Advances, Challenges, and Opportunities”. European Digital Media Observatory (EDMO), February 2024. <> ↩︎
  11. Delcker, Janosche. “Welcome to the age of uncertainty”. Politico. Dec 17, 2019. <> ↩︎
  12. Bueno, Natalia., Daniel Schiff., and Kaylyn Jackson Schiff. “The Liar’s Dividend: The Impact of Deepfakes and Fake News on Politician Support and Trust in Media.” Georgia Institute of Technology GVU Center. <> ↩︎
  13. Nicas, Jack., Lucia Cholakian Herrera. “Is Argentina the First A.I. Election?” New York Times. Nov 15, 2023. <> ↩︎
  14. Wirtschafter, Valerie. “The Impact of Generative AI in a Global Election Year”. Brookings Institution. Jan 30, 2024. <> ↩︎
  15. Hsu, Tiffany., and Steven Lee Myers. “A.I. Use in Elections Sets Off a Scramble for Guardrails.” New York Times. June 25, 2023. <> ↩︎
  16.  Sharma, Yashraj. “Deepfakes democracy: Behind the AI trickery shaping India’s 2024 election.” Aljazeera. Feb 20, 2024. <> ↩︎
  17. “Fake image factory: How image generators threaten election integrity and democracy.” Center for Countering Digital Hate (CCDH). March 6 2024. <↩︎
  18. Abdurashitov, Oleg., and Caterina Panzetti. “AI Regulatory Landscape in the US and the EU: Regarding the Unknown.” ITSS Verona. Jan 18, 2024. <↩︎
  19. “EU introduces new rules on transparency and targeting of political advertising.” Council of the European Union. March 24, 2024. <> ↩︎
  20. “Commission publishes guidelines under the DSA” European Commission. March 26, 2024. <> ↩︎
  21. “Murkowski, Klobuchar Introduce Bipartisan Legislation to Require Transparency in Political Ads with AI-Generated Content.” Lisa Murkowski, United States Senator for Alaska. March 6, 2024. <↩︎
  22. Klobuchar, Hawley, Coons, Collins Introduce Bipartisan Legislation to Ban the Use of Materially Deceptive AI-Generative Content in Elections.” Amy Klobuchar, United States Senator. September 12, 2023.  ↩︎
  23. UK Ministry of Justice., and Laura Farris MP. “Government cracks down on ‘deepfakes’ creation.” Press Release. April 16 2024. <↩︎
  24. Ahmed, Trisha. “Minnesota advances deepfakes bill to criminalize people sharing altered sexual, political content.” Associated Press (AP). May 11, 2023. <↩︎
  25. Jodka, Sara H. “Manipulating reality: the intersection of deepfakes and the law.” Reuters. Feb 1, 2024. <Manipulating reality: the intersection of deepfakes and the law | Reuters↩︎
  26. Content Authenticity Initiative Website: <↩︎
  27. Wirtschafter, Valerie. “The Impact of Generative AI in a Global Election Year” <> ↩︎
  28. Aïmeur, Esma., Sabrine Amri., and Gilles Brassard. “Fake news, disinformation and misinformation in social media: a review.” Social Network Analysis and Mining. Vol. 13, 30, 2023. <↩︎
  29. Cade Metz and Tiffany Hsu, “OpenAI Releases ‘Deepfake’ Detector to Disinformation Researchers”, New York Times, May 7, 2024.
    <> ↩︎
  30. Jones-Jang, S Mo, Tara Mortensen, and Jingjing Liu. “Does Media Literacy Help Identification of Fake News? Information Literacy Helps, but Other Literacies Don’t.” American Behavioral Scientist. Vol. 65(2). <↩︎
  31. Helmus, Todd C. “Artificial Intelligence, Deepfakes, and Disinformation: A Primer”. RAND Corporation, July 2022. <> ↩︎
  32. Hameleers, Michael. “Separating truth from lies: comparing the effects of news media literacy interventions and fact-checkers in response to political misinformation in the US and Netherlands. Information, Communication, & Society,. Vol 25(1). 2022. <↩︎

April 24, 2024No Comments

B.J. Sadiq on Pakistan’s Election Results, Pakistan Crises, and Imran Khan

In this interview, Mr. Sadiq discusses the history of Pakistani democracy delving into Imran Khan's legacy, the recent elections results, and the current political landscape in Pakistan.

B. J. Sadiq is a British is writer, journalist, and poet. He is the author of a bestselling biography of Pakistan's former Prime Minister, Imran Khan, "Let There Be Justice: The Political Journey of Imran Khan," and has also written a novella in verse, "Of Kings and Nobilities."

Interviewers: Angelo Calianno and John Devine - Middle East Team

September 28, 2023No Comments

Taiwan: What’s Next?

For our first Webinar of the 2023/24 season, we had the pleasure of hosting a great team of experts on Taiwanese affairs: Dr. Dafydd Fell, a distinguished Professor at SOAS University and the Director of the SOAS Centre of Taiwan Studies, and our very own ITSS researchers Sandra Watson Parcels and Ho Ting Hung (Bosco).

Our guests navigated the complexities of Cross-Strait relations, the upcoming Taiwanese elections, and the future of the semiconductor industry.

May 6, 2023No Comments

Turkey’s Election: The Earthquake, a Fragile Economy, and Why Erdogan May Win Again

Authors: Riccardo Bosticco, Miguel Jiménez, Michele Mignogna - Political Economy Team

In February, Turkey was hit by an earthquake that devastated the country. This sudden movement along faults appears to have brought to the surface not only a natural disaster but the policies of the incumbent president. Tayyip Erdogan’s rule was characterized by a period of rapid expansion in the aftermath of a previous quake in 1999; nonetheless, the increased power of the Turkish president has allowed him to deploy controversial economic policies which have contributed to the country’s to record inflation numbers. However, this growing control of all means may allow Erdogan to reshape the narrative and remain in power. Elections on May 14 will serve as a testing ground for this. 

Groundhog Day

Literature on natural disasters is broad, and its economic impacts have been intensely scrutinized. Among natural disasters, earthquakes take a particular spot, given their destructive nature. They represent adverse shocks that can affect the distribution of economic activity within a region and propagate throughout the economy via supply chains and trade linkages. Not surprisingly, beyond the inherent destructive power of each earthquake, the pre-existing economic conditions of the region hit may make the earthquake’s effects more severe. Hence, the economic growth of poorer economies with lower government spending and weaker institutions may take a more brutal blow from these events. Sitting at the intersection of three major tectonic plates, in the last three decades, Turkey has suffered two notorious earthquakes preceded by epochs of economic fragility. 

Back in 1999, an earthquake hit Kocaeli province near Istanbul with a death toll of over 17,000. The impact was magnified as a result of a preceding unstable economic period characterized by macroeconomic imbalances and external crises which hit the confidence of emerging markets, leaving the economy with modest growth and ill-prepared to face the earthquake. Although the 1999’s earthquake was lower in magnitude and occurred in less densely-populated areas, the regions hit were economic and industrial powerhouses, accounting for 7% of the GDP and 14% of the industrial value added. Furthermore, due to the linkages of these regions to the country’s main cities, the earthquake had spillover effects extending to an area accounting for 35% of the country’s GDP and half of the industrial output.

Despite these past events, the country has yet to improve its resilience against future earthquakes. As a matter of fact, the natural disaster that occurred last February brought ghosts from the past to the surface. The aftermath of the 1999’s earthquake appeared promising, with measures headed in the right direction: an earthquake tax was levied, and more than US $38 billion were raised to enhance Turkey’s urban resilience. Nonetheless, when the latest earthquake hit, causing damage that amounted to over US $34 billion and claiming the lives of over 50,000, some of the more than 20,000 collapsing buildings belonged to that wave of apparently earthquake-proof constructions

Tayyip Erdogan, who took office shortly after the 1999 incident, managed to renew 3 million housing units; however, much of the construction boom which has characterized his mandate could contain  numerous irregularities. To begin with, despite initial compliance with the government’s standards, construction developers managed to circumvent these initial premises due to poor monitoring and this, in turn, allowed them to cut back on the necessary materials needed to ensure resistant buildings. To make matters more dubious Erdogan accepted the amnesty program that forgave many of these developers for their millions of buildings’ faults. This happened weeks before the 2018 general election. It was seen as a popular move that enabled his government to reap the political dividends and to claim to have solved the housing problems for many city residents.

These facts and the latest earthquake demonstrate that the insufficient attention paid to natural disaster prevention in Turkey magnifies crises. Moreover, as shown below, they potentially contribute to economics that weaken Turkey’s finances and could make Erdogan’s position in the imminent elections more fragile. 

The Unorthoxy of Erdoganomics

As Turkey prepares for its May 14 elections, its economic crisis and inflation have emerged as significant campaign themes. Erdogan was already dealing with serious issues due to the country’s high inflation rate, the second highest in the G20 after Argentina. Now, the earthquake has made it a much more difficult situation. 

The currency poses a problem since Turkey’s central bank utilized $7 billion in reserves to stabilize the currency following severe earthquakes, encouraged banks to make derivative transactions on Borsa Istanbul, and increased the spread between Foreign Exchange and gold trading to reduce the demand for foreign exchange. After a string of unconventional interest rate cuts supported by Erdogan drove inflation to a 24-year high above 85% in October, it fell to 58% in January with a positive base impact and to about 50% in March. Projections establish that it should be around 35/40% in June, even if Turkish officials argue that due to the earthquake’s effects, it is likely to remain approximately 40-50%.

“We will improve the investment further with a structure based on a free-market economy integrated with the world,” the ruling party’s manifesto states. It aims to achieve a GDP of $1.5 trillion and an annual growth of 5.5 percent by 2028. In 2022, the GDP was a little less than $1 trillion. Consequently, the auspicious leapfrog is unlikely, given the projected $84 billion loss due to the earthquake (about 10% of Turkey’s GDP) and a devastated populace.


Recent questionable institutional and democratic changes can be considered to be at the root of Turkey’s economic problems and have allowed Erdogan to cut interest rates in the face of galloping inflation. According to someone, he has emerged as a political strongman since the bloody crackdown on the Gezi Park protesters in 2013. He has since consolidated further authority through a constitutional reform that changed the parliamentary system to a presidential one. He seemingly influences the country’s monetary policies through his control over the central bank, while technically still being an independent body. Three governors have been forced to quit in the last two years alone for defying the president’s unconventional requests.

All this may have given Edogan the opportunity to implement the so called “Erdoganomics,” the president’s alternative to neoclassical economic models, holding that higher interest rates raise inflation and not the other way around. In response to roaring inflation, Erdogan has continuously decreased rates, recently dropping by 50 basis points despite the earthquakes.

While casting doubts on economists, Erdoganomics also provides a puzzling issue for political scientists: why does the president continue to decrease rates despite the political fallout as the presidential elections get closer? Erdogan’s grip on the state’s institutions and the prominent position he has carved out for Turkey at the internal stage allow him more freedom to act according to his electoral needs. As argued below, the type of power system established by Ergogan could help him overcome the general idea that sees the economic crisis and earthquake badly managed.

Erdogan’s Grip on Power: Shielding from the (Un)wanted?

The earthquake crisis has added to the challenges facing Erdogan’s re-election, but the last word on the election’s outcome is difficult to predict. Two powerful party coalitions now dominate Turkey’s political scene. The Nationalist Movement Party (MHP) and the Great Unity Party (BBP) are now members of the People’s Alliance, which is being led by President Erdogan (AKP). The Nation Alliance, which unites six opposition parties, represents the majority of the opposition and is led by Kemal Kilicdaroglu, also known as the “Turkish Gandhi”. However, a third group could be crucial to how the future elections turn out. It comprises minor left-wing organizations, but includes a political powerhouse too, the Peoples’ Democratic Party (or HDP), the most prominent pro-Kurdish organization, which, according to Soli Zel, the HDP will probably influence the election outcome with 12% to 15% of the vote.

Even if the earthquake mismanagement and Turkey’s economic turmoil blow a wind of change in Turkish politics, President Erdogan can still turn things in his favor. The President’s established system of power and influence can strengthen Erdogan’s rally-around-the-flag and help him win support. The national earthquake crisis has overwhelmed Turkey’s rescue teams, and the state has activated a level-4 alert, requiring international help. Despite the abovementioned issues regarding emergency preparedness and Turkey’s economy, Erdogan could still arrive safely at the next election. 

If opinion polls indicate stormy weather for the president, he could potentially extend the state of emergency to postpone the elections – the last state of emergency declared in Turkey, in 2016, lasted two years. Moreover, the from many considered illiberal power system shaped by Erdogan could give him access to defeat the opposition and stay in power. 

Turkey’s president has purged courts, law enforcement agencies, civil service, intelligence agencies, military officers, and the media while strengthening his ties with the loyalists. Turkey’s judicial system is not entirely independent. In December 2022, Ekrem İmamoğlu was sentenced to two years for “insulting public officials”. He was a popular figure from the secular center-left. Similarly, more than 100 politicians from the People’s Democratic Party, pro-Kurdish, remain trialed for terrorism offenses, the movement risking being outlawed. 

Erdogan’s media power can be considered disproportional: as a Reuters investigation found, in Turkey, “[t]he biggest media brands are controlled by companies and people close to Erdogan and his AK Party, following a series of acquisitions starting in 2008”. While social media could serve as an alternative to the politicization of traditional media outlets, they can hardly be exempted from delivering misinformation, an article from Politico writes. In fact, the government has taken a more proactive stance against them: “[w]ith a new controversial social media law, Turkish authorities now have the right to control and, if necessary, restrict online free speech in ways that would be unthinkable in any democracy”, noted Aslı Aydıntaşbaş, a visiting fellow at the Brookings Institute.

In addition to that, in two years of power Erdogan was able to bring society closer to a more conservative idea of Islam. While Turkey’s relationship between government and religion has always been in flux despite the Constitution not recognizing any official state’s faith, the current president has refueled Islam’s force. If the process provoked protests by secularized citizens of the Turkish metropolises, Erdogan was nevertheless able to consolidate his grip in the Anatolian heartland and rewrite the narrative around Islam as a source of political identification and ideology playing a more significant role in the era of social media. Beyond that, in the past, he has shown his ability to transform difficult situations in his favor. For example, when a military putsch was attempted at Istanbul’s Atatürk Airport in 2016, Erdogan responded: “[t]hey will pay a heavy price for this. [...] This uprising is a gift from God to us.”; this episode can be seen as a confirmation of the Turkish de-secularization.

Thus, Erdogan may take advantage of the current emergencies pending in Turkey. His influence on the judicial and information system may help him rally the society around the Turkish flag, consolidating a pool of voters around the need to be united against the damages of the earthquake and a weak economy. In such a situation, Turkey’s foreign policy activity may also help in the president’s favor, not the least the war in Ukraine and Erdogan’s positioning as a mediator.

While opinion polls do not favor the incumbent, anything can be expected from the May 14 elections. Despite signs of illness registered recently, Erdogan has returned to the electoral stage in ‘thundering’ form and giving the impression that he will do anything to stay in power. 

January 23, 2023No Comments

New Year, New Debt Distress in Africa

Author: Alessandra Gramolini.

The year that has just begun does not seem to be rosy for the African continent. At the beginning of 2022, Africa suffered from the pandemic and its effects on the economy. 2023 opens with many nations facing another crisis: unsustainable debt.

The crisis has been underway for years, long-term loans have more than doubled reaching 636 billion dollars in the decade 2011-2021, a figure that exceeds the gross domestic product of more than 40 African countries taken together. The pandemic has worsened the economic situation and the war in Ukraine has pushed many countries to the brink, cutting off access to finance, depleting foreign exchange reserves and sending national budgets into a tailspin.

Living on the razor’s edge

Debt is the biggest problem they will face even though the ratings agency, Fitch, expects average debt in sub-Saharan Africa to improve and be below 65% in 2023, after reaching 72% in 2020, helped from the economic recovery after the pandemic, rising commodity prices and efforts to reduce budget deficits, but this level compares with an average of 57% in 2019, before the pandemic, and with less than 30% between 2007 and 2013.

According to the analysis of the public debt of sub-Saharan African countries, almost half of the countries (42%) have a debt-to-GDP ratio above 70%, while the average debt-to-income ratio will continue to be above 300%, double the value of 2013. This would prove the deterioration of the economic bases of these countries and their evolution prospects.

The risks these countries will face are related to high inflation, difficult financial conditions, the general indebtedness of the economies caused by the pandemic and now also by the Russian invasion of Ukraine.

Fitch also forecasts that average inflation in the region will fall from about 8% in 2022 to 5.5% this year and that GDP growth will be around 4%, close to the average of 3.8% in the five years up to 2019, but well below the growth recorded up to 2014. In some countries, however, inflation is well above the regional average. Add to this that there are eight sub-Saharan African countries with government debt payments, in 2023, accounting for a quarter of foreign reserves.

Election year

On the political front, many countries will be called to vote during 2023. The results of these elections could increase the discontent of the populations already strongly suffering from the increase in the prices of basic necessities.

Election time can be very volatile in Africa and the 2023-24 cycle will be no different, with a high risk of political protests, mass demonstrations and strikes in a number of countries. Upcoming elections in countries such as Algeria, Madagascar, Nigeria, South Africa and Zimbabwe could prove hotbeds of disruptive civil unrest in 2023. Worsening socioeconomic conditions in some of these countries, driven by subdued wage growth, rising costs of living and food security concerns, could also prove problematic for incumbent or new government administrations.

What’s next?

While African policy makers can’t influence the global headwinds, they can take steps to build resilience. Rising prices of commodities in a continent endowed with everything from diamonds, iron ore, bauxite, cobalt, copper to platinum offer a chance to create stabilization or sovereign wealth funds to insulate against future shocks. The key to building savings is to have proper governance, by some estimates Africa has 20 such funds already, but not all have delivered.

Recent research says that China and the West should work together to find solutions for African debt distress. The report says that although China’s lending to Africa did not cause the current debt in the continent, it must cooperate with the international community and African nations, to support Africa’s investment needs, after a year of recession for most economies on the continent.

The G7, led by the incoming Japanese presidency for 2023, could develop and build support for a new plan to be eventually embedded at the G20 level on debt relief and investments in Africa. The plan could include a broad-based dialogue led by the G7, African nations, and China on:

  •  Africa’s medium- to long-term external financing needs; 
  • a high-level political understanding between the West and China on the mutual benefit of strengthened cooperation to address African debt distress; 
  • and a detailed action agenda, led by the G7 and G20 Finance Tracks, to address obstacles for debt treatments.

A way out of this situation could be strong reforms to find long-term solutions that can meet African economies’ financial needs and avoid a similar scenario in the future.