Obasanjo, Okonjo-Iweala, others seek $44bn debt relief for Africa

Former Nigerian President, Olusegun Obasanjo and erstwhile Managing Director of the World Bank, Ngozi Okonjo-Iweala have joined other world leaders in demanding a debt relief in the sum of $44 billion that will enable African countries have enough fiscal room to combat COVID-19.

Alongside world leaders numbering more than 100, the two are requesting “immediate internationally coordinated action–within the next few days–to address our deepening global health and economic crisis from COVID-19”.

The leaders noted in a letter addressed to the G20 nations that the economic crisis of 2008 to 2010 was less difficult to handle than the current pandemic experienced by the whole world.

“In 2008-2010, the immediate economic crisis could be surmounted when the economic fault line—under-capitalization of the global banking system—was tackled.

“Now, however, the economic emergency will not be resolved until the health emergency is effectively addressed: the health emergency will not end simply by conquering the disease in one country alone, but by ensuring recovery from COVID-19 in all countries,” the letter says.

The leaders similarly requested the international community to “waive this year’s poorer countries’ debt repayments, including $44 billion due from Africa, and consider future debt relief to allow poor countries the fiscal space to tackle the health and economic impact of the COVID-19 pandemic.”

Read also: Nigerian govt will transfer N457bn subsidy money to other sectors –NNPC boss

Okonjo Iweala, who spoke at an interview on AIT Thursday, envisaged that economies in Africa will generally experience slow growth because of the outbreak while many may slip into a long recession if the situation worsens.

She stated that the push for a debt relief was necessary in order to forestall hunger, death and to resuscitate the economies.

“The recession will depend on the extent of the lock-down in many of our countries and maybe the COVID19 may start accelerating in a number of cases.

“If this continues to accelerate and there are many more deaths, it means that it might be wise to keep the lockdown for longer.

“The longer you lock down, the more the economy is impacted because there is no economic activity and the more likely you are to go into a very deep recession or even a depression,” Mrs Okonjo-Iweala said.

 

Join the conversation

Opinions

Support Ripples Nigeria, hold up solutions journalism

Balanced, fearless journalism driven by data comes at huge financial costs.

As a media platform, we hold leadership accountable and will not trade the right to press freedom and free speech for a piece of cake.

If you like what we do, and are ready to uphold solutions journalism, kindly donate to the Ripples Nigeria cause.

Your support would help to ensure that citizens and institutions continue to have free access to credible and reliable information for societal development.

Donate Now