African Ministers of Finance are calling for coordinated efforts around the continent against the coronavirus pandemic, failing which the continent will suffer even serious social and economic consequences.
In a virtual conference March 19, the Ministers acknowledged that even before the outbreak of the COVID-19 disease, the continent was already experience a huge financing gap in funding measures and programmes aimed at realizing SDGs and Agenda 2063 targets and goals.
“The Ministers emphasized that without coordinated efforts, the COVID-19 pandemic will have major and adverse implications on African economies and the society at large. Original economic forecasts in most economies are on average, being downgraded by 2-3 percentage points for 2020 due to the pandemic,” a press release from the Economic Commission for Africa (ECA) copied to ghanabusinessnews.com says.
Among others, the Ministers, the release indicates agree on the following:
That as part of an immediate health response, there is a need for a coordinated response in the logistics and delivery of testing equipment; The continent they agree needs an immediate emergency economic stimulus to the tune of $100 billion. As such, the waiver of all interest payments, estimated at $44 billion for 2020, and the possible extension of the waiver to the medium term, would provide immediate fiscal space and liquidity to the Governments, in their efforts to respond to the COVID-19 pandemic. The interest payments waiver should include not only interest payments on public debt, but also on sovereign bonds. For fragile states, the ministers agreed on the need to consider waiving principal and interest and encourage the use of existing facilities in the World Bank, International Monetary Fund (IMF), African Development Bank (AfDB) and other regional institutions.
They called for support to the private sector as well as protecting the over 30 million jobs at risk, particularly in the tourism and airline sectors across the continent. In other critical sectors including agriculture, imports and exports, pharmaceuticals and in banking, the ministers agreed that all interest and principal payments on corporate debt, leases, extended credit facilities, refinancing schemes and guarantee facilities should be used to waive, restructure and provide additional liquidity in 2020. A liquidity line should also be made available to the private sector to ensure the continuity of essential purchases and all SMEs that are dependent on trade can continue to function, the release said.
“These measures, it was agreed, must accompany a policy of opening borders for trade. In this regard, the ministers noted that Europe and the United States, in particular, can build this in as part of their stimulus to their private and financial systems,” it added.
By Emmanuel K. Dogbevi