The UN official said that Africa’s 54 nations are collectively $1 trillion in the red for non-payment of sovereign debt, with several nations dodging their repayment commitments. Claver Gatete, the executive secretary of UN—ECA, stated that Africa continues to face major hurdles as regards funding, security, climate change, and the like.
Such problems are putting a lot of fiscal stress on nations: Over one-third of the SDG countries are either in debt distress or at high risk of it, as Gatete noted at the Southern African Development Community’s parliamentary assembly in Zimbabwe. He pointed this out as happening against the backdrop of a decline in Multilateral concessional funding, Official development assistance, and foreign direct investment.
Some of the countries have recently made deals with their dollar bondholders following protracted discussions under the common framework in the group of twenty, including Ghana and Zambia. It plans for Ethiopia to resume its talks with the bondholders in the next several weeks after achieving a major deal with the International Monetary Fund (IMF) last month.
Moreover, Gatete opined that climate change is affecting the continent’s economy so badly that it reduces an average of $5 billion annually of Africa’s GDP. Mozambique, for instance, experienced a loss of 15% of its GDP through the calamities occasioned by climatic conditions in the last year only.
He insisted on the need for an African-led push to change the very architecture of the global financial system to ensure that the leaders and institutions on the continent are putting Africa’s requirements on needful meetings with multilateral financial institutions, including the World Bank and the IMF.
