  Citation: Appiah-Kubi, S.N.K.; Malec, K.; Phiri, J.; Krivko, M.; Maitah, K.; Maitah, M.; Smutka, L. Key Drivers of Public Debt Levels: Empirical Evidence from Africa. Sustainability 2022, 14, 1220. https://doi.org/10.3390/ su14031220 Academic Editors: Pompeo Della Posta, Enrico Marelli and Marcello Signorelli Received: 29 November 2021 Accepted: 20 January 2022 Published: 21 January 2022 Publisher’s Note: MDPI stays neutral with regard to jurisdictional claims in published maps and institutional affil- iations. Copyright: © 2022 by the authors. Licensee MDPI, Basel, Switzerland. This article is an open access article distributed under the terms and conditions of the Creative Commons Attribution (CC BY) license (https:// creativecommons.org/licenses/by/ 4.0/). sustainability Article Key Drivers of Public Debt Levels: Empirical Evidence from Africa Seth Nana Kwame Appiah-Kubi * , Karel Malec , Joseph Phiri , Mikhail Krivko , Kamil Maitah, Mansoor Maitah and Luboš Smutka Department of Economics, Faculty of Economics and Management, Czech University of Life Sciences in Prague, 16500 Prague, Czech Republic; maleck@pef.czu.cz (K.M.); phiri@pef.czu.cz (J.P.); krivko@pef.czu.cz (M.K.); maitahk@pef.czu.cz (K.M.); maitah@pef.czu.cz (M.M.); smutka@pef.czu.cz (L.S.) * Correspondence: appiah-kubi@pef.czu.cz; Tel.: +420-608-399-941 Abstract: The rising public debt level in Africa and the sustainability of that debt remains an important research agenda. As such, understanding the factors that impact the rising public debt level in Africa remains an important research agenda. Our paper investigates the key determining drivers that have a direct and indirect impact on the rising level of public debt in Africa from a panel of 47 African nations for the period 2000–2018. Using the generalized method of moments (GMM) and fixed effects two-stage least squares (IV-FE) methodological approach the study confirms that a rise in the corruption level leads to an increase in the public debt in Africa. Our findings additionally indicate that government investment enhances the positive and significant association with public debt levels in the sampled countries. Our result revealed that government consumption and tax revenue have a significant negative relationship with the levels of public debt in Africa. Lastly, our results showed that military expenditure has a positive but insignificant relationship with public debt levels in Africa. In terms of policy recommendation, the study suggests African countries should intensify the fight against corruption and strengthen political and governance institutions that will help reduce public debt levels and promote economic growth and development. Keywords: corruption; public debt; government investment; government consumption; military expenditure; tax revenue 1. Introduction Each country aims to achieve economic development. As a result of this, countries are implementing projects that will support economic development. The goal of achieving economic stability and development must finance essential sectors of the economy to propel growth [1,2]. Usually, these sectors are unviable for private investors to venture because of the high initial outlay involved [3]. Nevertheless, when governments invest in these key sectors, it boosts both domestic and foreign investors’ confidence to also venture into these businesses [4]. These sectors include education, health, agriculture, sanitation, technology, infrastructure, and many others [5,6]. According to Serven and Solimano [7], considering the huge initial capital needed to undertake this development agenda, governments usually run into deficits since gov- ernment revenue generated from taxes, charges fees from publicly provided goods and services, profits from state enterprises and seignories from the central bank among others are insufficient. Governments usually rely on borrowing to bridge the financing gap, especially in the case of developing countries [8–10]. The act of government borrowing externally or domestically from institutions, countries and individuals encapsulates the concept of public debt. The main principle rooting this credit facility is that, eventually, gains from these projects will cover the debt incurred [11]. Sustainability 2022, 14, 1220. https://doi.org/10.3390/su14031220 https://www.mdpi.com/journal/sustainability