COVID-19: African Leaders Insist on Two-year Debt Standstill

African Heads of State and Government as well as business leaders in the continent have expressed strong support for a two-year debt standstill as a result of the ravaging coronavirus pandemic. The position emerged from a videoconference held by African Union (AU) Chairperson and President of South Africa, President Matamela Cyril Ramaphosa, with some of the continent’s political and business leaders.

That was as the World Health Organisation (WHO) named Nigeria’s former Minister of Finance and former Managing Director (Operations), World Bank, Dr. Ngozi Okonjo-Iweala, as Special Envoy for its newly inaugurated Access to COVID-19 Tools (ACT) Accelerator. Director-General of WHO, Dr. Tedros Ghebreyesus, disclosed this during the launch of the ACT Accelerator, through an online conference that took place in Geneva.

The African leaders’ meeting was held on April 22 but the communiqué was released at the weekend. The communiqué stated that African leaders would want creditor nations and multilateral institutions to give the continent a two-year debt halt and address the issue of private debt. The Heads of State and Government reaffirmed their commitment to maintain a united, cohesive front in order to defeat the menace of COVID- 19.

To ensure a coordinated implementation of the Africa COVID-19 response strategy, the AU chairperson decided to convene a meeting with the Heads of State and Government who chair Regional Economic Communities (RECs) as soon as possible.

AU Heads of State and Government called on business leaders in the continent to establish a private sector platform to develop further proposals to support the continental response strategy for combating the COVID-19 pandemic.

The Heads of State and Government and business leaders expressed their unwavering support for WHO under the stewardship of the Director-General, Dr Tedros Adhanom Ghebreyesus, in the fight against COVID-19. They noted the existential threat faced by the private sector in Africa, particularly small and medium enterprises (SMEs).

The leaders welcomed commitments totalling $16.5 million in support of the fight against COVID-19, comprising $11 million for the AU COVID-19 Response Fund, and $5.5 million for the Africa Centres for Disease Control (CDC), made on March 26.

During the meeting, Ramaphosa said he had undertaken a range of actions, including addressing the virtual Summit of the G20, holding teleconferences, and writing letters of appeal to various world leaders. He said together with AU Commission Chairperson, Mr Moussa Faki Mahamat, he addressed a virtual joint meeting of the World Bank and IMF on April 17. They urged the international financial institutions to do “whatever it takes” to avoid further human and economic costs from the unprecedented impacts caused by the pandemic. They also called for, among other measures, the allocation of more Special Drawing Rights Allocations (SDRs) to Africa to provide much-needed liquidity to central banks, the corporate sector, and SMEs. They called for the waiver of all interest payments from multilateral and bilateral debt, with a view for extension.

This would provide the necessary fiscal space for African governments to devote all available resources to response and recovery, they said. Ramaphosa and Mahamat stressed the urgent need for a debt standstill as well as other support measures that should be extended beyond International Development Association (IDA) countries, including both IDA blend and International Bank for Reconstruction and Development (IBRD) facilities for African countries.

Ramaphosa reiterated the urgent need for the provision of critical medical supplies and equipment, including personal protective equipment (PPE), sanitisers, and ventilators. In addition to the public health crisis posed by COVID-19, he underscored the devastating socio-economic effect of the pandemic on African countries, and emphasised the need for rapid and concrete support from international partners, to ensure trade and investment flows are not further disrupted by measures not consistent with WTO rules during this extraordinary external global shock.

During the videoconference, Ramaphosa called on the Chairperson of AU Commission to brief the Heads of State on progress made in operationalising the AU COVID-19 Response Fund.Mahamat gave detailed explanations regarding appointment of a Board of Trustees as well as the legal framework outlining the governance and operational structure to ensure the transparency and accountability of the fund. He told the Heads of State and Government and business leaders about his consultations with the chairperson of the bureau on the recommendation from the Permanent Representatives Council (PRC) on adding two members of the private sector onto the Board of Trustees of the fund.

Mahamat also announced the AU/Africa CDC initiative, the Partnership to Accelerate COVID-19 Testing (PACT), which is underpinned by t

he refrain, Test and Trace, and aims to increase testing capacity on the continent for SARS-CoV-2 by 10 million tests in the next four months.The Director of Africa CDC, Dr John Nkengasong, also addressed the meeting. Nkengasong provided the meeting with an overview of the COVID-19 situation on the continent, disclosing that 24,686 cases of COVID-19 infections have been reported on the continent and 1,191 people have died from it, while 6,425 have recovered. He noted that since the implementation of lockdowns in African countries, the rate of new infections had slowed dramatically.

However, this did not mean that the situation had stabilised, instead it showed that the lockdowns were effective, he stated. Nkengasong emphasised the important role of the private sector, including private laboratories, with regard to testing, logistics and transport of samples and materials, increase in local manufacturing of needed materials, and deployment of health workers for the implementation of PACT. (Thisday)