WORLD / AFRICA
Macron to host continent conversation on growth
Published: May 16, 2021 06:48 PM
French President Emmanuel Macron will on Tuesday host a virtual summit of European and African leaders to seek solutions to the financial crisis in Africa, where governments hope to boost development while managing debts. 

The "summit on ­financing African economies," bringing together 30 heads of state and government via ­videoconference, was planned in 2020, after the International Monetary Fund (IMF) ­calculated that African economies risk running into a total "financial gap" of $290 billion by 2023.

Economic growth on the continent, which experienced its first recession in 2020, is expected to rebound to 3.4 percent in 2021 and 4.0 percent in 2022. 

A moratorium on debt servicing, put in place in April 2020 by the G20 and Paris Club group of creditor nations, has given Africa a bit of breathing space, suspending the repayment of 5.7 billion euros ($6.9 billion) by 50 countries.

The G20 also convinced China, by far the biggest bilateral lender on the continent, and private creditors to take part in future debt negotiations. 

But this won't be enough.

"We are collectively in the process of abandoning Africa to solutions that date from the '60s," Macron said in April, calling for a bold "New Deal" for Africa.

The French leader warned of the risks of failing to act, including reduced economic opportunities, increased migration and "the expansion of terrorism."

The COVID-19 pandemic has exacerbated the problems on the continent.

Although Africa has so far counted 130,000 deaths from coronavirus - behind most world regions - 18 African leaders in mid-April warned that "only a total victory, including the whole of Africa, will bring this pandemic to an end."

Many have warned that ­developed nations are busily vaccinating their own nationals and leaving poorer countries behind.

The African leaders called for an "immediate moratorium" on the servicing of all external debts until the end of the pandemic, and the ring-fencing of development aid.

They also urged the IMF to issue African nations special drawing rights (SDRs) convertible to global currencies like the dollar, euro or yen, to provide them with "the liquidity essential for the purchase of basic products and essential medical equipment."

Macron has also suggested that the IMF sell gold to fund ­interest-free loans to African countries.