Africa Walking “financial tightrope”, Jesuits Say amid Calls for Global Support

In the report, Fr. Chilufya notes that more than ever, Africa needs increased global financing to reduce poverty and to build a healthier and more prosperous future for the continent.

The aim of the workshop that concluded Thursday, January 27 was to develop the JENA advocacy strategy to support post-COVID-19 recovery in Sub-Saharan Africa.

The JENA Director has observed that the pandemic dealt a huge blow on African countries and that many of them might not recover unaided.

“The shocks of the COVID-19 pandemic are reversing hard-won gains in poverty eradication over the last few decades in Africa,” the Zambian-born Jesuit Priest says. 

Citing the African Development Bank (AfDB) Africa Economic Outlook 2021 report, Fr. Chilufya reports that “an additional 38.7 million more Africans have been driven into extreme poverty resulting in 34.4% of the African population grappling with extreme poverty.”

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Recovery in Africa “is walking a financial tightrope” given the financial liquidity challenges the continent is facing, JENA Director observes in his report shared with ACI Africa January 28.

“In normal times, African countries would raise the funds to kick-start their economic recovery by availing themselves of concessional finance, commercial borrowing, or increasing domestic resource mobilization. In this global pandemic, though, these options are either unavailable or inadequate,” the leadership of JENA says.

Although there are global commitments by institutions such as the IMF and World Bank to support economic resilience to the unprecedented crisis, more funds are predominantly being channeled to the High-Income Countries (HICs), the leadership of the JCAM department notes.

“To boost global liquidity, the IMF approved a historical general allocation of Special Drawing Rights (SDRs) amounting to S$650 billion in August 2021.The allocation is meant to benefit all members, particularly the vulnerable ones struggling to cope with the impact of the COVID-19 crisis,” Fr. Chilufya has further noted. 

In his presentation during the workshop, JENA Global Policy and Advocacy Officer, Fernando Saldivar, has been quoted as saying, “The IMF rules on SDR are biased against the vulnerable low-income countries. The rich countries have received over $400 billion worth of the allocated SDRs with African countries accessing only $33 billion of the facility.”

In his opening remarks, the President of JCAM that hosts JENA, Fr. Agbonkhianmeghe Orobator, said that while the COVID-19 pandemic poses serious challenges, it is also “an opportunity to accelerate the transformation of hearts and structures needed to build a healthier and more just world.”

“With both caution and optimism, Pope Francis has stated several times that the COVID-19 pandemic is the defining crisis of this generation, from which we can either emerge better or worse,” Fr. Orobator said.

In the report shared with ACI Africa, JENA commits to collaborate with other stakeholders to advocate for global policies that yield expanded financial resources to support “building back better” in Sub-Saharan Africa and other developing regions.

“JENA is calling for debt relief, fair distribution of the IMF's SDR facility, suspension of debt repayment by all developing countries, and curbing of illicit financial flows to promote resilience and recovery,” the JCAM justice and ecology department says.

The leadership of the department further appeals to the international community to bring the pandemic under control through large-scale debt-free financing for mass vaccination in developing countries particularly in Africa, “to ensure that the recovery efforts do not drive the economies deeper into debt.”

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Agnes Aineah is a Kenyan journalist with a background in digital and newspaper reporting. She holds a Master of Arts in Digital Journalism from the Aga Khan University, Graduate School of Media and Communications and a Bachelor's Degree in Linguistics, Media and Communications from Kenya's Moi University. Agnes currently serves as a journalist for ACI Africa.