By Francis Ntow
Accra, Sept. 14, GNA – Africa is pushing for reforms to the global financial architecture to improve access to affordable finance, support economic transformation and create jobs.
The reforms seek to address debt restructuring, climate finance, concessional financing, digital development and the mobilisation of domestic capital to support the continent’s development needs.
Ms Mavis Owusu-Gyamfi, President and Chief Executive Officer (CEO) of the African Centre for Economic Transformation (ACET), said the global financial system was not adequately supporting Africa’s economic and development ambitions.
She said the Future of Development Cooperation Coalition (FDCC) and ACET were working to ensure that Africa’s priorities were reflected in global financial policy discussions and outcomes.
The continent is seeking a faster, more predictable and fairer debt restructuring system, while calling for climate adaptation to be better integrated into development finance.
It is also seeking global cooperation to ensure that artificial intelligence (AI) and the digital revolution do not widen the digital divide, while creating opportunities for African countries to mobilise domestic capital from pension funds, insurance, sovereign wealth and capital markets.
The FDCC, a multi-governmental and stakeholder institution, and ACET are championing the initiative to reform the global financial architecture to better support development in Africa.
The blueprint was outlined in Accra during an exclusive interview with the Ghana News Agency with co-chairs and members of the Coalition on the sidelines of its third Commissioners’ Meeting.
Africa is using its representation on the Coalition to channel recommendations to the G20 Common Framework, International Monetary Fund (IMF), World Bank, private creditors and African development institutions.
Ms Owusu-Gyamfi said debt remained an important instrument for economic growth but the existing restructuring framework was not delivering the speed and predictability required by African and other developing economies.
“Debt is not a bad; every country that has grown has used debt as one instrument. The question is how it is managed; how do restructurings happen? The system is currently not working with the speed and predictability that it needs,” she said.
Ms Alexia Latortue, Head of the Coalition Secretariat and a former US Treasury Assistant Secretary, called for expanded concessional financing windows to support Africa’s infrastructure, climate and energy-access needs.
On AI and the digital revolution, she said global development institutions needed to ensure that the fourth industrial revolution did not deepen the digital divide but enabled Africa to keep pace and leapfrog.
“You can’t talk about AI without energy, connectivity and organised data first, so development institutions must shift from direct lenders to catalysts, using equity and guarantees to crowd in private capital for local innovation ecosystems,” she said.
Ms Clemence Landers, Vice President and Senior Policy Fellow at the Centre for Global Development (CGD), said Africa was prepared to finance most critical sectors, including health, education, farmer support and roads, from domestic resources.
She said the push to reset the global financial architecture was being driven by a severe external financing squeeze, including a 25 per cent decline in Official Development Assistance (ODA) following political shifts in traditional donor countries.
“Post-COVID inflation and monetary tightening in advanced economies returned African sovereigns to the capital markets, paying almost double the rates and creating a double setback of collapsing concessional aid and expensive commercial borrowing,” she noted.
Ms Landers said many African countries had strengthened their macroeconomic positions, built buffers and foreign exchange reserves, and deepened domestic capital markets despite the financing constraints.
“This resilience is now informing Africa’s demand that the global system move from an aid-centric model to one that recognises trade, domestic capital, risk perceptions, and affordable finance as core to transformation and job creation,” she said.
GNA
Edited by Kenneth Sackey
Reporter: Francis Ntow