African Leaders Renew Calls for Urgent Debt Relief and Financial Assistance

Leaders from several of Africa’s largest countries including South Africa, Kenya, and Ethiopia renewed their urgent appeals on Tuesday for debt relief, debt cancellation, and immediate financial assistance from the international community to help support economies across the continent amid the increasingly dire economic crisis.

What’s notable about the latest pleas from South African President Cyril Ramaphosa, Kenyan President Uhuru Kenyatta and Ethiopian Prime Minister Abiy Ahmed is how familiar they are. Since March, when the pandemic worsened in Africa, these and other African leaders have repeatedly issued similar appeals, all to little or no effect.

Here’s a summary of their requests:

• Extend the G20’s Debt Service Suspension Initiative through 2021.
• Provide an immediate cash injection of between $100-$150 billion to assist African economies facing liquidity challenges.
• Issue new IMF Special Drawing Rights that would provide additional capital to the world’s poorest countries.
• Cancel debt.

There seems to be a disconnect between the traditional donors at the IMF, World Bank, and the Paris Club, and what the Chinese are saying on the issue of debt relief. Over the past several weeks, we’ve heard repeated critiques from World Bank President David Malpass, G7 Finance Ministers, and others that China is not doing enough within the G20’s DSSI process.

Yet at the same time, Chinese officials, including President Xi Jinping, and various ambassadors in Africa and elsewhere enthusiastically tout the progress that Beijing is making finalizing DSSI talks with requesting countries.

What’s clear, based on the latest appeals from African leaders issued on Tuesday, is that whatever is being done is not nearly sufficient nor happening fast enough.

Key Highlights From Presidents Ramaphosa and Kenyatta’s Speeches Requesting Debt Relief

• SOUTH AFRICAN PRESIDENT CYRIL RAMAPHOSA: “As agreed by African Finance Ministers on 19 March 2020, Africa needs immediate emergency financing… which would provide fiscal space and liquidity to governments. Our view is that the Debt Service Suspension Initiative in its current form does not go far enough. South Africa supports extending the initiative and, in certain instances, considering the cancellation of debt.” (SABC News)

• KENYAN PRESIDENT UHURU KENYATTA: “Developing countries are seeking to have the existing debt moratoriums refined and extended to December 2021, and an early replenishment of the IMF Poverty Reduction and Growth Trust and the World Bank International Development Association, as well as an early decision on the Special Drawing Rights.” (NATION)

SUGGESTED READING:

• Nation: Uhuru makes debt plea to UN by Aggrey Mutambo
• The Diplomat: China, the World Bank, and African Debt: A War of Words by Deborah Brautigam

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The post African Leaders Renew Calls for Urgent Debt Relief and Financial Assistance appeared first on The China Africa Project.

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