AfricaBusiness

AFRICA NEEDS MORE FISCAL SPACE – WTO

By BUUMBA CHIMBULU
ARICA’S economies require short-term policies that will enable them to get more fiscal stimulus, says World Trade Organisation (WTO) Director General, Ngozi Okonjo-Iweala.

Dr Okonjo-Iweala reiterated her call to restructure debt owed by African countries to enable them provide economic stimulus for their economies and accelerate recovery from Covid-19 devastation.

She stressed the importance to discuss debt restructuring and giving African economies fiscal space to recover.

This, she explained, would allow African governments to invest not only on the health side but also on the economic side.

“This is how we are going to recover,” Dr Okonjo-Iweala said at a virtual UBA Africa Day Conversation 2021.

She acknowledged efforts by President Paul Kagame of Rwanda to push for the issuance of new Special Drawing Rights (SDR) at the International Monetary Fund (IMF), which agreed to provide US$650 billion.

Africa, Dr Okonjo-Iweala said, would get US$34 billion but indicated that more may be allocated.

“We can use this to help implement more fiscal stimulus so that our economies can have the ability to recover. Moreover, some liquidity should go to the private sector.

“You know that in rich countries, private sector has gotten access to credit and liquidities that enabled their Small and Medium Enterprises (SMEs) to recover,” she said.

At the same meeting, United Bank for Africa (UBA) Chairman, Tony Elumelu, urged governments and business leaders in Africa to prioritise youth empowerment and job creation.

Mr Elumelu, also Founder of the Tony Elumelu Foundation (TEF) stated that by prioritising youth empowerment and job creation, countries would be able to improve the standard of living on the continent and address the challenge of unemployment.

He stressed that the priority for Africa was the empowerment of its youths and ensuring the creation of jobs and economic opportunities even during very difficult times.

“We have seen how our young ones despite Covid-19 leveraged their talents, expertise and technology to create wealth and support the communities they live in.

“We must, therefore, ensure that these young ones are made and not erased. We must create an enabling environment for our young entrepreneurs to succeed and empower them to create the jobs that would lift the continent to prosperity,” Mr Elumelu said.

And President Kagame urged African leaders to develop the political will to make free movement of people within the continent a reality in order to facilitate African trade.

Mr Kageme called for investment that would enable the continent to be part of the fourth industrial revolution that has been changing how people’s lives and work.

“The social and economic effects of the pandemic are very clear. We are counting on our continents resilience to see us through this crisis.

“Fortunately, we are working together as a continent with our partners to build Africa’s vaccine manufacture capacity,” he said.

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