Some two dozen leaders of African countries and heads of global financial institutions attended a summit in Paris on Tuesday (18 May) hosted by French President Emmanuel Macron, which sought to provide the continent with critical financing swept away by the impact of COVID-19. It was also attended by international financial leaders, including International Monetary Fund (IMF) chief Kristalina Georgieva as well as World Bank managing director of operations Axel van Trotsenburg. The summit agreed on a plan to help Africa overcome the economic effects of the coronavirus pandemic, including by boosting financing on the continent to counter the devastating economic effects of the coronavirus pandemic while also tackling the slow vaccine rollout.
Africa has so far been less badly hit by the pandemic than other global regions – with a total of 130,000 dead across the continent. However, the economic cost is only too apparent, with the IMF warning in late 2020 that Africa faces a shortfall in the funds needed for future development – a financial gap – of $290bn up to 2023. A moratorium on the servicing of public debt agreed in April 2020 by the G20 and the Paris Club, a group of creditor countries that tries to find sustainable solutions for debtor nations, was welcomed but will not be enough on its own. Many African leaders want a moratorium on the service of all external debt until the end of the pandemic. “We are collectively in the process of abandoning Africa by using solutions that date from the 1960s,” the French President said last month, warning that failure would lead to reduced economic opportunity, sudden migration flows and even the expansion of “terrorism”. “We have taken the first step in what we have agreed to call a New Deal with Africa,” Macron told the summit.
The summit also agreed to work towards getting rich nations to reallocate €81 billion in IMF special drawing rights monetary reserves to African states by October. IMF Managing Director Kristalina Georgieva had confirmed the organization will issue $33 billion for the African continent this year in special drawing rights, a foreign exchange tool used to help finance imports. The summit aims to triple that amount. “We cannot afford leaving the African economies behind,” said the summit’s final declaration. “This is a great opportunity for Africa,” said Democratic Republic of the Congo President Felix Tshisekedi, the current head of the African Union. The pandemic “left our economies impoverished because we had to use all the means we had, the few means we had, to fight against the disease,” Tshisekedi said. Moreover, the summit also agreed the African continent should be able to “massively” produce vaccines for its own population via technology transfers and lifting barriers to intellectual property.
