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African countries should unite on the reform of the global financial architecture

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The 56th Conference of Ministers of Finance, Planning and Economic Development (COM2024) closed in Victoria Falls, Zimbabwe with a consensus that African countries should with one voice, advocate for the reform of the global financial architecture for it to be fit for purpose and serve Africa’s development priorities.

The ministers also called upon countries to develop instruments and institutions that can bridge the technology gap and develop innovative financing mechanisms that can work for Africa with the right governance frameworks.

“We, African Ministers of Finance, Planning and Economic Development having deliberated on the theme of the conference, note that Africa is off track in most indicators of the 2030 Agenda of the Sustainable Development and has even regressed in some,” said the ministers in their statement.

“Also, the first 10 year implementation plan of the African transformation Agenda 2063 has just ended with visible achievements in some areas and shortcomings in others.”

In this regard, the ministers noted that Africa requires an additional $1.6 trillion by 2030 to achieve the SDG goals and that the actual expenditure on the attainment if the goals on the continent falls short of the amount required to achieve them.

Claver Gatete UN Under-Secretary-General and Executive Secretary, Economic Commission for Africa (ECA) said the resolution adopted on tax cooperation is important as it will help countries strengthen domestic resource mobilization and prepare for the Financing for Development Conference that will take place in 2025.

“This, indeed, marks a pivotal step towards fostering a fair and equitable global economic system,” said “Building inclusive green economies in Africa is not merely an anecdote but a pressing imperative that demands our concerted action,” said Mr. Gatete.

“In addition, the innovative solutions proposed, and the partnerships forged underscore our resolve to advance economic prosperity for all Africans.”

He indicated that ECA is reorienting its work, with particular focus on deepening our intellectual leadership on technology, infrastructure and climate.

“This will enable us to better support countries to accelerate the implementation of Agenda 2063 and the SDGs,” he said.

The ECA Executive Secretary extended his heartfelt gratitude on behalf of ECA to the President, the entire government and to the people of Zimbabwe for their warm hospitality.
In their statement, the African ministers raised their concern over the public debt burden in Africa that has worsened during the past decade, with the average debt-to-gross-domestic-product ratio on the continent sharply increasing since the 2010s, from 39.49 per cent between 2010 and 2014, to 56.41 per cent between 2015 and 2019, to 70.47 per cent in 2020.

In addition to the need for increased financing, they said, there is a need for more effective policy and regulatory frameworks to help to close development and climate finance gaps in Africa, and that a supportive policy environment for scaling up renewable energy.

Mthuli Ncube, Minister of Finance, Economic Development and Investment Promotion said that the economic growth in Africa remained subdued in 2023, amid tight monetary policies, low demand for African exports and global factors such as the geopolitical tensions, leading to elevated food and fuel costs, as well as limited fiscal space. This is also being compounded by the imposition of unilateral sanctions on some African member states by the developed world.

“The Conference explored policy options that encompass reforming the global financial architecture, boosting private sector participation, exploring innovative financing tools, implementing the African Continental Free Trade Area and fostering regional and global cooperative initiatives to drive climate resilience and sustainable development across the continent,” said Mr.Ncube.

He noted that countries should urgently transition to inclusive green economies, to restructure the global financial landscape, to accelerate regional integration, and to provide tailored support for our Least Developed Countries (LDCs) and do not leave behind Middle Income Countries caught in the development trap.

The ministers recommended that the Economic Commission for Africa and its partners to systematically support the sustainable debt coalition in contributing to efforts to tackle the foreign debt challenges faced by Africa and the reform of the global financial architecture.

On the reform of the global financial architecture the ministers called upon ECA to intensify its work in ensuring the timely reform of the global financial institutions to make them fit for purpose and able to serve the interests of Africa and developing countries elsewhere in the world.

ECA, they said should collaborate with the African Union and other partners, to take steps to enhance the role of science and technology in the transformation of Africa into an inclusive green economy, including through the establishment of harmonized rules and principles in respect of the promotion. protection and enforcement of intellectual property rights within the African Continental Free Trade Area.

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