African ministers in charge of finance have met with the UN Economic Commission for Africa (UNECA) Executive Secretary, Vera Songwe, and the Managing Director of the International Monetary Fund (IMF), Kristalina Georgieva, to discuss immediate economic response to the COVID-19 pandemic.
“During the virtual meeting, which was convened by the UNECA and IMF, the ministers were unanimous in their call for additional liquidity, 500 billion U.S. dollars in Special Drawing Rights (SDR), better market access, more concessional resources and an extension in the Debt Service Suspension Initiative (DSSI), given the prolonged nature of the pandemic,” according to a UNECA statement issued Tuesday.
“We all know that the COVID-19 pandemic will persist for the next 2-3 years. Why are we extending the DSSI for 6 months and not 24 months?” an ECA statement issued Tuesday quoted Ken Ofori-Atta, Ghana’s minister of Finance and Economic Planning, as saying during the meeting that was held on Feb. 5.
Ofori-Atta said the cascading effects of COVID-19 were “a frightening thing for a finance minister to witness when they don’t have the means to respond.”
On access to the markets, Egypt’s Minister of Finance Mohamed Maait said “there’s a strong case for vulnerable countries to access the markets at affordable rates to afford essentials such as PPEs and food for their populations.”
Equitable access to COVID-19 vaccines was also highlighted as “an imperative for building forward better.”
Georgieva, who noted that the world stands to lose an estimated 9 trillion U.S. dollars if only the rich get COVID-19 vaccines, stressed that 40 percent of this loss will be in advanced economies.
In addition to vaccine availability, the UNECA Executive Secretary emphasized that the issues of distribution and deployment were also worthy of serious attention. And for this reason countries needed additional fiscal space and less austerity.
The IMF chief also noted that in order to build forward better, there is a need for “bold and immediate action for response, recovery, and reset of African economies,” adding “liquidity and financing response is the bridge to vaccines and recovery.”
The meeting mainly envisaged seeking IMF support in forging a way out of the crisis by transforming existing liquidity instruments and easing market access to alleviate the debt burden and provide much needed liquidity for the continent, according to the ECA statement.
The meeting, among other things, agreed on the need for a concerted effort to accelerate reforms to increase revenues, improves expenditure and manages debt to attract more private sector investments into Africa, it was noted.
On Saturday, Cyril Ramaphosa, president of South Africa who is also the outgoing chairperson of the African Union (AU), emphasized that the ongoing COVID-19 pandemic is not just a severe health emergency; it is also a grave economic and social crisis.
Speaking during the 34th Ordinary Session of the Assembly of the African Union (AU), the South African President said the pandemic has “deepened global inequality and threatens to set back progress towards the achievement of the Sustainable Development Goals.”
“As a continent, and as a global community, we are engaged in an unprecedented struggle against the COVID-19 pandemic,” Ramaphosa said, adding the pandemic has caused great suffering and hardship across the African continent. Enditem