Africa Day: IMF spares Africa ‘loose change’ from global recovery fund
President Ramaphosa is calling on the IMF to allocate 25% of the R9.03 trillion made available to replenish world economies, to Africa.
South Africa’s president held a stern tone in his Africa Day message, following a brief trip to a summit in Paris, France.
Global finance admits Africa was left behind
Cyril Ramaphosa was one of many African leaders who stood next to France president Emmanuel Macron as he called for “a New Deal for Africa and by Africa”.
This call was part of many discussions held at the Summit on the Financing of African Economies that took place in Paris earlier this week.
Global financing bodies and first-world leaders conceded to leaving African economies behind in the face of a COVID-19 pandemic that’s ruptured millions of livelihoods on the continent.
In a daunting outlook report released by the International Monetary Fund (IMF), it’s said that Africa may face a year-on-year debt shortfall totalling R4.03 trillion ($290 billion), until, at least, 2023.
Lack of access to vaccines has compounded problems in Africa and Macron was the first to stand under the spotlight and tug at the developed world’s conscience.
“The current situation is not sustainable, it is both unfair and inefficient. We are asking the World Health Organization (WHO), the World Trade Organization (WTO) and the Medicines Patent Pool to remove all these constraints in terms of intellectual property which blocks the production of certain types of vaccines,” the French leader said.
IMF allocates 5% to ‘uprooting’ Africa from economic crisis
Ramaphosa, reflecting on the summit, questioned the IMF’s distribution of ‘Special Drawing Rights’, a quota system the world’s financial bodies conjured up “to create the much-needed fiscal space for African economies.”
South Africa’s president explained that based on membership quotas, the IMF will break up R9.03 trillion ($650 billion) in emergency funds to replenish the world’s economies.
However, of that amount, only 5% (R458 billion) will be allocated to Africa.
“African leaders have however argued that an amount of $33 billion, while welcome, is not sufficient to meet the challenges that the continent faces. As the more developed economies are set to receive much of the $650 billion of Special Drawing Rights to be issued, we believe that 25% (which equates to $162.5 billion [or R2.25 trillion]) should be made available to African countries,” Ramaphosa said.
Whether the constructs of these Special Drawing Rights are negotiable, remains to be seen. The IMF, however, has recognised that the Achilles’ heel to a global financial resurgence is leaving African economies behind.
The fund’s chief executive Kristalina Georgieva warned that a small window remains open for developed worlds to assist Africa in saving its economy from an abysmal slump and it starts with boosting the continent’s vaccine rollout.
“It is clear that there is no durable exit from the economic crisis unless we exit the health crisis,” she said.
The world celebrates Africa Day
Ramaphosa’s childish naivety still triumphed in his reflection on the summit. In his Africa Day message, the president still held on to the hope that Africa will, one day, “become a continent that is thriving and prosperous.”
“As a country, we are part of Africa and Africa is part of us. What happens in one part of our continent affects us all, and so we must work together to recover from this crisis, and to ensure that our continent grows and thrives,” he wrote.
The world has joined in on the celebrations of Africa Day on social media. Here are a few messages from the online world on the 58th anniversary of Africa Day:
Today we celebrate our home Africa, the wealthiest continent on the global map. #Africa has abundant minerals, wildlife, oil and natural resources, and yet the continent bears the brunt of resource curses, illicit financial flows & climate injustice.#AfricaDay #AfricaDay2021 pic.twitter.com/uNJLSyhHWO— Advocates4Earth (@Advocates4Earth) May 25, 2021
#AfricaDay— Mbuyiseni Ndlozi (@MbuyiseniNdlozi) May 25, 2021
Forward to the United States of Africa