WhyAfrica needs more external aid
African countries require external assistance to enable sustained fiscal consolidation and economic growth, National Treasury Cabinet Secretary Ukur Yatani has said.
He said in addition to measures pronounced by the G20 under the Debt Service Suspension Initiative (DSSI) and support from the International Monetary Fund (IMF) restoring economic recovery will require significant additional external financing.
In new proposals presented during a meeting of the Coalition of the Willing of African finance ministers and the World Bank and the IMF, Yatani said priority of the region remains saving lives and livelihoods through increased spending on health and safety nets, moving spending away from less urgent areas, and providing liquidity to small businesses to forestall a greater humanitarian crisis in the region is important.
First, the CS said equitable and affordable access to vaccine is critical and help from the international community is urgently required.
Secondly, the enhancement of the DSSI through extension of the consolidation period for a further one year to June 2022 will yield additional external resources, addressing debt vulnerabilities and providing liquidity.
Also required is enhancement of the limits of access to IMF facilities through reallocation of existing SDRs and allocating new SDRs including strengthening the quick disbursement of the IMF through Rapid Credit Facility and (Rapid Financing Instrument (RFI) and short-Term liquidity lines.
Low income
“With most low income countries external debt owed to multilateral creditors, the World Bank and the IMF should consider innovative solutions to re-profile existing debts owed by poor and lower-middle income countries, on a case by case basis to avoid emergence of a humanitarian crisis in the region,” Yatani said in a statement.
He said strengthening of DSSI through extension of the consolidation period for a further one year to June 2022 will yield additional external resources, addressing debt vulnerabilities and providing liquidity.
