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The emerging use of total return swaps in Sub-Sahara African debt management

Author

Listed:
  • Danny Cassimon
  • George Mavrotas

    (University of Antwerp, Belgium)

Abstract

In reaction to the continued tightening of credit condi- tions and reducing fiscal space, also some Sub-Sahara African countries have started to use credit deriva- tive instruments in the form of so-called 'Total Return Swaps' (TRS) as an alternative funding and debt liabil- ity management tool. This contribution briefly explains what the technique entails, zooms in on the reasons for its use but also focuses on the embedded risks, some- what opaque nature and current contestation of the use of the instrument, before briefly zooming in on the three documented Sub-Sahara African country experi- ences (Angola, Nigeria, Senegal) so far. To conclude, we position the application of this instrument within the broader global debt architecture and its current falla- cies.

Suggested Citation

  • Danny Cassimon & George Mavrotas, 2026. "The emerging use of total return swaps in Sub-Sahara African debt management," Development Finance Agenda, Chartered Institute of Development Finance, vol. 11(4), pages 6-8.
    • Handle: RePEc:afj:journ4:v:11:y:2026:i:4:p:6-8
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    File URL: https://journals.co.za/doi/abs/10.10520/ejc-defa_v11_n4_a2
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