African finance ministers call for coordinated COVID-19 response to mitigate adverse economic impacts

Source: Xinhua| 2020-03-24 01:40:44|Editor: yan
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ADDIS ABABA, March 23 (Xinhua) -- African ministers of finance on Monday called for coordinated continental COVID-19 response mechanism in order to mitigate the adverse impacts of the COVID-19 pandemic on African economies and societies.

The African ministers of finance, who met in a virtual conference due to COVID-19 related concerns, exchanged ideas on the efforts of their respective governments in dealing with the social and economic impacts of COVID-19, the United Nations Economic Commission for Africa (UNECA) disclosed in a statement on Monday.

The ministers "noted that even before the COVID-19 pandemic, Africa was already experiencing a huge financing gap in funding measures and programmes aimed at realizing SDGs and Agenda 2063 targets and goals," the final meeting outcome communique issued by the ECA read.

The finance ministers also emphasized that "without coordinated efforts, the COVID-19 pandemic will have major and adverse implications on African economies and the society at large."

According to figures from the ECA, original economic forecasts in most economies are on average, being downgraded by 2-3 percentage points for 2020 due to the pandemic.

The African ministers of finance during their virtual conference meeting also agreed that as part of an immediate health response, "there is a need for a coordinated response in the logistics and delivery of testing equipment."

The ministers also emphasized "the need to work with the WHO and existing continental institutions, in particular, the African Union (AU) and the Africa Center for Disease Control and Prevention (Africa CDC), while making maximum use of existing systems and funding partners, such as the Global Fund."

They also underscored that particular attention should be placed on fragile states and vulnerable populations, especially women and children and those living in informal urban settlements.

"Given the limited health infrastructure and the fact that most of the pharmaceuticals and medical supplies consumed in Africa are imported, the ministers called on the international community to support the upgrade of the health infrastructure and to provide direct support to the existing facilities," the statement read.

According to the ECA, the African continent needs an immediate emergency economic stimulus to the tune of 100 billion U.S. dollars. As such, the waiver of all interest payments, estimated at 44 billion U.S. dollars for 2020, and the possible extension of the waiver to the medium term, would provide immediate fiscal space and liquidity to the governments, in their efforts to respond to the COVID-19 pandemic.

The ministers, who argued the interest payments waiver should include not only interest payments on public debt, but also on sovereign bonds, also stressed the need to consider waiving principal and interest and encourage the use of existing facilities in the World Bank, International Monetary Fund (IMF), African Development Bank (AfDB) and other regional institutions for fragile African states.

They also underscored the need to support the private sector and protect more than 30 million jobs at risk, particularly in the tourism and airline sectors across the continent.

The ministers also stressed that all interest and principal payments on corporate debt, leases, extended credit facilities, refinancing schemes and guarantee facilities should be used to waive, restructure and provide additional liquidity in 2020 for other critical sectors including agriculture, imports and exports, pharmaceuticals and in banking.

"A liquidity line should also be made available to the private sector to ensure the continuity of essential purchases and all small and medium enterprises that are dependent on trade can continue to function," the final communique read.

The ministers also agreed that the measures "must accompany a policy of opening borders for trade."