Burkina Faso increases reliance on regional debt markets

Burkina Faso is facing increasing economic pressure as it relies heavily on regional credit markets to manage its growing debt. The country's public treasury recently launched a new 100 billion FCFA bond issuance on the West African Monetary Union (UMOA) market, scheduled between October 12 and 30.

This move is part of a broader trend where the Burkinabè government has raised over 1,000 billion FCFA on the UMOA public securities market since the beginning of the year. While these funds are used to cover recurring deficits, the reliance on high-cost regional borrowing is raising concerns about long-term fiscal stability. The new 100 billion FCFA issuance is a ten-year bond, a first for the country, intended to spread out repayments but potentially increasing the total cost of credit due to interest rates between 6.60% and 7%.

As of the first half of 2025, Burkina Faso's public debt reached 8,311 billion FCFA, representing a 13% increase over one year. Approximately 60% of this debt is sourced internally. This high level of domestic borrowing risks a crowding-out effect, potentially limiting the liquidity available to local businesses and financial institutions.