Africa makes case for better financial architecture

Africa called for an improved global financial architecture that would better serve the continent at a key economic meeting that concluded on Tuesday.

Africa's finance and economic development ministers gathered in the Senegalese capital Dakar for the the seven-day 54th session of the Conference of African Ministers of Finance, Planning and Economic Development under the theme "Financing Africa's Recovery: Breaking New Ground".

While delivering a keynote speech on Tuesday, Macky Sall, Senegal's president, called on Africa's development partners to agree to a renegotiation of the terms of the current multilateral system. This is in light of shocks dealt to the global economy by the COVID-19 pandemic and the conflict between Russia and Ukraine.

"The COVID-19 pandemic has shown that existing financial instruments are not working for countries which needed them the most. Africa needs money, but we cannot get it. It is like a COVID-19 patient who needs oxygen but is told - we have the oxygen but cannot give it to you because we don't have the instruments," Sall said.

"No sooner had we begun to recover from the constraints of COVID-19 than the war in Ukraine came. Although the war affects the globe, it has unique consequences for Africa. We are now forced as a continent to speak up and call for changes in the global system. Thankfully, these days, everybody seems to concur that the international system needs restructuring," he added.

Speaking at the opening session, Ngozi Okonjo Iweala, the director-general of the World Trade Organization, made a case for global trade as a crucial requirement for equitable and sustainable growth.

She said the pandemic and war in Ukraine had caused countries to realize equitable trade was vital in moving goods and funds from areas of plenty to areas where there was a deficit.

Vera Songwe, UN undersecretary-general and executive secretary of the United Nations Economic Commission for Africa, said the COVID-19 pandemic had come as an attack not just on health but on the economy.

"African countries have been at war for three years, war with COVID-19, climate change, terrorism and the war on bad governance. So, finding innovative financing solutions is the need of the hour because we are looking not just for survival, but for prosperity," Songwe said.

She expressed hope that in restructuring the multilateral system, Africa will become a continent that actively contributes in designing global solutions.

Among the proposals discussed during the meeting was Africa gaining more of a voice by having a permanent seat at the G20. This was emphasized by Rebecca Grynspan, secretary-general of the United Nations Conference on Trade and Development.

Grynspan said Africa was suffering despite having done nothing wrong. Extending the World Bank's Debt Suspension Service Initiative, which helped the poorest countries during the pandemic, and orderly and rational debt instruments were part of the solution, she said.

Delegates also looked at sustainable options to scale up public financing, bring in private sector financing, leverage climate financing and facilitate trade finance. The African Continental Free Trade Area was also described as a potential game-changer, with its demonstrated capacity to pool countries into a single market.