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African countries should seek debt relief-Okonjo Iweala

Nigeria’s former minister of finance Dr. Ngozi Okonjo-Iweala, says African countries need to quickly pressure the G7 and G20 for debt-relief in other to deal with the economic and health issues arising from the novel coronavirus.

Okonjo-Iweala, who was very instrumental in getting Nigeria an $18 billion debt-relief as minister of finance, said African countries in debt need to apply for such relief to free up resources to battle COVID-19.

Okonjo Iweala spoke on the British Broadcasting Corporation (BBC) news programme saying,  if African countries get debt relief, the monies they should pay in servicing debts — which for Nigeria is N2.72 trillion in 2020 budget — can be channeled towards dealing with COVID-19.

The former managing director of the World Bank, said Africa needs multiple sources of funds to tackle the global pandemic and its economic effects.

She said: “You know we have several sources, you’ve got the African Development Bank, which has just floated a social bond for $3 billion that will be available to the countries on the continent.

“You have the World Bank that has set aside $14 billion of which they’ve already committed $2 billion to 25 countries — and 11 of them are Africans. Many of our countries need to move, to take advantage of this, and they are willing to commit $150 billion dollars over the next 15 months.

“The IMF has put forward $50 billion as an emergency fund, and already 80 countries have applied for this, many of them African”.

“It also has a $1 billion grant fund; catastrophe containment and relief trust, which they can approach. Let me mention my own organisation, GAVI, where I am chair of the board. We have made immediately available $200 million to $300 million grant.

“Once these monies become available, if the countries get debt relief, that means that the monies they would have been paying to service the debt that they’ve taken from other countries; bilateral debts or from institutions, this monies can now be used to procure food and supplied and support the livelihood of people in the rural and urban area.

“Government can use these resources as part of an intervention fund to help people directly, and I think this is what they should be looking to do. But we need to move quickly, the debt relief we haven’t got it yet.

“There needs to be a great deal of pressure on the G7, G20 to come forward with this measure and then countries need to start availing themselves of the already available resources, and then pressure for the debt relief.”

 

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