MIL OSI Translation. Government of the Republic of France statements from French to English –
Source: IMF in French
October 9, 2020
Text written for the intervention
Excellencies, Ministers, Ladies and Gentlemen, thank you for participating in this important event, which I have the honor to co-organize with President Malpass. I would also like to greet Mr. Guterres, Secretary General of the United Nations, and Mr. Moussa Faki Mahamat, Chairman of the African Union Commission.
We are gathered here today because COVID-19 continues to damage the health and well-being of people, and to take a heavy toll on the economy. In Africa, the number of cases stands at more than one million, 23,000 deaths have been confirmed and countless more have not been. Jobs have been lost, family incomes have fallen by 12% and, according to our colleagues at the World Bank, up to 43 million more people are at risk of falling into extreme poverty, reversing a trend that we were so proud.
Together we face this crisis and it is in everyone’s interest to mobilize and jointly fight against this pandemic. And that means mobilizing alongside Africa.
Since our first “Mobilize with Africa” meeting held last spring, we have seen African leaders act quickly, despite often very tight financial constraints. They increased spending on health and social programs by 2.5% of GDP on average to meet the needs of their population.
Support measures have also been taken globally.
The international financial institutions have provided considerable financial assistance as part of the fast-track support. As such, the IMF provided approximately $ 26 billion, which has helped fight the disease and lessen its economic impact on people and businesses. This amount is ten times greater than the annual average of loans we have granted over the previous decade. And as the crisis continues, we continue to mobilize. In recent weeks, the IMF’s Executive Board approved a six-month extension to the increase in access limits under our Rapid Credit Facility and our Rapid Finance Instrument, as well as a six-month extension of debt relief for the poorest member countries under the Disaster Assistance and Response Trust Fund.
Countries like Burkina Faso, The Gambia and the Central African Republic have put in place remarkable governance mechanisms to ensure that the funds released actually benefit their populations.
The financing challenge
That said, we all, countries and institutions alike, must do more to help Africa tackle the next phase of emerging from this crisis.
Despite large-scale internal adjustments, African states still have financing needs in the order of $ 1,200 billion by 2023. Some countries face a heavy debt burden that forces them to choose between debt service and an increase in social and health spending.
Current commitments from international financial institutions and official bilateral creditors are expected to meet less than a quarter of this amount. As the level of private capital remains low, we face a projected deficit of more than $ 345 billion by 2023, and almost half of that is in low-income African countries.
Meeting the financing challenge
Today’s meeting is about the decisive steps we can take to close this gap.
At the IMF, we know how important and urgent it is to strengthen our support to Africa so that the continent can accelerate its long climb to recovery.
First, we are working with our member countries to further increase our capacity to lend on concessional terms. We have made impressive progress in replenishing the Poverty Reduction and Growth Trust Fund and we continue to work with member countries who can afford it to temporarily lend us part of their SDRs and in this way, we can increase concessional loans to countries in need. We also appeal for new pledges that will increase concessional finance for low-income countries.
Second, we pledge to work with countries with unsustainable debt. We support the extension of the G20 debt service suspension initiative. Beyond this initiative, we recognize the need to further strengthen the international debt restructuring architecture and we will continue to restructure debts on a case-by-case basis if necessary. We are pleased with the strong support from our member countries for strengthening the disaster relief and response trust fund, as we work to mobilize the necessary pledges for a third tranche.
Third, we are prioritizing supporting African leaders through our financial programs as well as our monitoring and capacity building activities. The crisis offers opportunities for reform and structural transformation that must be underpinned by strong policies and institutions. Without reform, foreign aid will be neither effective nor sufficient. We will respond to help our member countries implement their strategies aimed at strengthening public finance management, ensuring financial stability and inclusion, stimulating trade, removing obstacles to private investment, accelerating growth and create jobs for young people. We will support measures to improve the quality of public spending in key areas: health, education, social protection, digital switchover and infrastructure.
In all of our activities, we will work hand in hand with national authorities, regional institutions and bilateral and multilateral partners.
The pandemic does not stop at national borders: linked by a rope, we all climb a mountain together in the midst of the storm. And our strength is only measured by the weakest climbers.
Supporting each other, mobilizing alongside Africa is therefore not only the best choice, it is the one and only solution.
IMF Communications Department
PHONE: +1 202 623-7100 EMAIL: MEDIA@IMF.org
EDITOR’S NOTE: This article is a translation. Apologies should the grammar and / or sentence structure not be perfect.