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African Ministers Plan to Seek Revamp of Global Financial Order

African Ministers Plan to Seek Revamp of Global Financial Order
Mthuli Ncube Photographer: Stefan Wermuth/Bloomberg

African finance ministers plan to call for an overhaul of the global financial system to better suit a continent facing high levels of debt, increasing climate shocks and soaring inflation. 

They will discuss the proposal at a United Nations Economic Commission for Africa meeting in the Zimbabwean resort city of Victoria Falls.

Given the challenges facing the continent, access to finance for Africa must be made cheaper and easier, Zimbabwean Finance Minister Mthuli Ncube told delegates on Wednesday. The conference concludes on March 5.

“There is a need to re-look at the international financial architecture to ensure that it is fit for purpose,” he said.

Read More: Zimbabwe Creditors See Debt Talks Resuming Despite Disputed Vote

Zimbabwe is among more than a dozen African nations struggling with high levels of debt. It defaulted with international financial institutions more than two decades ago, leaving it locked out of lines of credit. Zambia, Ghana and Ethiopia are seeking to restructure their liabilities through the Group of 20’s Common Framework.

African nations should look at leveraging their vast natural resources to reduce debt and rebase their gross domestic product, according to Ncube. The G-20 framework and climate change funding needed to be revamped to meet the continent’s needs, he added.

“As we discuss the issue of greening our economies, it is important to take into account our forests, which can be the source for developing a thriving carbon market based on fair prices,” Ncube said.

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  • Robert Pegg says:

    You have got to ask why African countries get themselves into this debt trap in the first place ?
    The obvious answer is they borrow more than they can afford to repay to keep politicians and civil servants on the gravy train. Ghana is a typical example as the IMF have stated they must reduce their civil service costs to be considered for more bailouts.
    South Africa is not far behind as can be seen in the recent article comparing Eskom workforce with comparable US power utility workforce. More than double the employees to give the same outcome.

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