Post-COVID-19 recovery: African leaders want $100bn World Bank loan

President Nana Addo Dankwa Akufo-Addo and 22 other African leaders are calling on the International Development Association (IDA) of the World Bank Group to raise $100 billion to support African countries to recover and be resilient after COVID-19.

They said the concessionary funding would also help African countries transform their economies.

The Heads of State also pledged to work to improve their capacity to absorb resources for the diligent execution of projects and programmes and to continue efforts to mobilise tax revenue, and to use transparently and efficiently the mobilised resources, while strengthening governance.

The leaders further resolved to accelerate economic recovery from the shocks of the COVID-19 pandemic, scale up investments in human capital, and increase their job creation efforts.

They, however, called for expanded access to vaccines which was critical for the rapid recovery of the world economy.

Summit

The African leaders made the call at the end of a one-day IDA20 Replenishment Advocacy Summit of Heads of State and Government of 23 African countries and the World Bank Group in Abidjan.

The conference, organised by the World Bank, was opened by President Alassane Ouattara of Cote d’Ivoire.

The IDA20 Replenishment Advocacy meeting aimed at mobilising African leaders to solicit for higher funding from donors for the IDA20 cycle to support a green and resilient recovery from challenges accentuated by COVID-19.

Critical action

In a speech read on his behalf by a Minister of State at the Finance Ministry, Mr Charles Adu Boahen, who led a four-member team to represent Ghana, President Akufo-Addo noted that: “If the Organisation for Economic Cooperation and Development (OECD) governments can borrow more than $18 trillion to respond to the pandemic, donors should be able to find $100 million to replenish IDA20 to fund vital health care, education, social services and welfare protection for the world’s most vulnerable societies”.

The President noted that the COVID-19 pandemic was an unprecedented crisis for which all must strive to protect their people and the planet, adding that “for the first time in this century we realise how closely and irrevocably bound our fortunes are”.

He, therefore, called on the developed world to take a critical action to vaccinate the world and find the necessary funds to save lives to allow the reopening of the global economy.

President Akufo-Addo noted that unlike most parts of the world, Africa responded to the COVID-19 crises with swift, prudent innovative policies to safeguard lives and livelihoods.

However, he said, the economic fallout had taken a disproportionate toll on developing countries.

Context

The International Monetary Fund (IMF) estimates that Africa needs $425 billion in medium-term funding to return to the pre-pandemic economic growth status.

African economies contracted by negative 2.1 per cent and the debt to Gross Domestic Product (GDP) ratio has risen to 73.19 per cent and is also likely to achieve only 53 per cent of the Sustainable Development Goals (SDGs) by 2030.

Opportunity

While calling on the world to support Africa, President Akufo-Addo also noted that COVID-19 had given African countries a historic opportunity to recreate the continent and a chance to build Africa that was prosperous and not dependent on charity of others, adding, “a continent that engages with other countries competently through trade, investment and political cooperation for enhanced global peace and security.

He said to that end, Ghana had launched the 100 billion COVID-19 Alleviation and Revitalisation of Enterprises Support (CAREs) Programme to revitalise the economy as well as develop the country into a regional hub for financial services, logistics, tourism and light manufacturing.

The country is also leveraging the location of the AfCFTA Secretariat to expand intra-African trade.

World Bank

The World Bank Managing Director for Operations, Mr Axel van Trotsenburg, noted that recognising the need for Africa to have long-term concessionary and predictable loans, with increased grant portion, the World Bank had committed about half of its resources to Africa.

He said the IDA20 advocacy conference would provide African countries the platform to develop country driven priority programmes to improve the livelihoods of her citizens, therefore, “an ambitious IDA20 will be a powerful force in helping countries with a green and inclusive recovery to get back to the 2030 goals.”

Countries

Participating countries were Ghana, Angola, Benin, Burkina Faso, Cameroon, Côte d’Ivoire and the Democratic Republic of Congo.

The rest are Ethiopia, Guinea, Guinea Bissau, Kenya, Liberia, Madagascar, Mauritania, Mozambique, Niger, Nigeria, Uganda, Rwanda, Senegal, Sudan, Tanzania and Togo.

Other notable participants were the President of the Economic Community of West African States (ECOWAS) Commission, the President of the Economic and Monetary Community of Central Africa (CEMAC) Commission, the representative of the President of the West African Economic and Monetary Union (UEMOA) Commission and the World Bank Group.

Source- Graphic Online