18 Feb. (EUROPA PRESS) –
The Secretary General of the United Nations, António Guterres, denounced this Saturday the “extortion” of which the African continent is being victimized at the hands of a global financial system, in need of a “radical transformation”, which prevents African countries from development of their “vital systems”.
Such a thing never happens because “the global financial system denies them debt relief as a rule, or any financing on concessional terms, while charging exorbitant interest,” said the secretary-general at the opening of the African Union summit to be held celebrated in the Ethiopian capital, Addis Ababa.
As a result, “African countries cannot invest in critical areas” such as health, education, green technology, social protection or the creation of new sustainable jobs, and at the same time climb “the development ladder with one hand tied behind the back.”
It should be remembered that, last year and according to the International Monetary Fund, the public debt indices in sub-Saharan Africa reached their highest point in more than two decades.
Several governments have requested debt restructuring agreements in the framework of an IMF program to facilitate their exit from the crisis, but the conclusion of the process has been delayed. Other countries like Kenya, which have refrained from participating in this program, have seen their debt sustainability indicators plummet, particularly due to the impact of the coronavirus pandemic.
“We need a new debt architecture that provides debt relief and debt restructuring to vulnerable countries, including middle-income countries, while providing immediate debt suspension and write-downs to countries that need it.” added the UN Secretary General.
In this sense, and as he has done on other occasions, Guterres has asked the Multilateral Development Banks to transform their business model to accept a new approach to risk. Among the options that he proposes, he requests that they “massively leverage” their funds to attract greater flows of private capital.
