Paris summit mobilizes finance and vaccines against Africa’s “New Deal” | Business and Economy News


A Paris summit on Tuesday promised to help Africa overcome the coronavirus pandemic with a “New Deal” that uses global financial firepower to replenish depleted boxes and increase the slow deployment of the vaccine.

The summit, which brought together African leaders and global financial institutions, launched “a new agreement for Africa and for Africa,” French President Emmanuel Macron told a news conference.

According to the latest AFP news agency count of official sources, there have been a total of about 130,000 coronavirus deaths among African populations during the pandemic, compared to nearly 3.4 million worldwide, all and that experts believe official tolls in African countries could be lower.

The economic cost of the pandemic has been devastating, as the International Monetary Fund warned in late 2020 that Africa faces a $ 290 billion deficit by 2023, which undermines all development efforts.

Meanwhile, a slow deployment of vaccines has raised concerns that variants could emerge on the continent that would later spread around the world.

The summit was dominated by fears that while richer nations were launching economic recovery packages, Africa did not have the means to follow suit and risked increasing inequality and therefore insecurity.

“We cannot afford to leave African economies behind,” the summit’s final statement said.

Call for vaccine patent exemptions

Macron said there was also great inequality in terms of Africa’s limited access to coronavirus vaccines and the summit hoped that patents would be removed so that Africa could start producing its own blows.

Citing the slow pace of vaccination as a major problem for the continent, Macron sought to vaccinate 40% of people in Africa by the end of 2021.

“The current situation is not sustainable, it is unfair and inefficient,” he said.

“We call on the World Health Organization (WHO), the World Trade Organization (WTO) and the group of drug patents to remove all such limitations in terms of intellectual property that block the production of certain types. of vaccines, “Macron added.

Senegalese President Macky Sall hailed a “change of mindset” in the approach, as G20 nations realized that their own well-being depended on the progress of the vaccine in Africa.

“We have a common responsibility; vaccinating one’s own populations does not guarantee health security, “he said.

“This is a great opportunity for Africa,” said Congolese President Felix Tshisekedi, the current head of the African Union. The pandemic “impoverished our economies because we had to use all the means we had, the few means we had, to fight the disease.”

IMF chief Kristalina Georgieva warned that not accelerating the deployment of vaccines in Africa would also have economic consequences.

“Clearly there is no lasting way out of the economic crisis unless we get out of the health crisis,” he said.

In the financial field, “we will take advantage of the international financial system to create the much-needed fiscal space for African economies,” the final statement said.

The signatories said they would push for the IMF’s rapid general allocation of $ 650 billion in special collection rights (SDRs) to all its members, of which approximately $ 33 billion would go to Africa.

SDRs are a reserve asset that is used to strengthen the financial position of IMF members, based on a basket of currencies, which can be converted into much-needed dollars.

French President Emmanuel Macron speaks during a joint press conference at the end of the summit [Ludovic Marin/Reuters]

The United States has been pushing for this IMF to be paid to offset the economic impact of COVID-19, including low-income countries.

Macron told the news conference that several rich countries had agreed to return their share of SDRs to African countries because the $ 33 billion “is too scarce,” in the hope that voluntary contributions could increase the African quota to 100,000. millions of dollars, to which the IMF could add some of its gold reserves.

Some experts have criticized SDRs for being easy money for fiscally irresponsible nations, and Tuesday’s statement urged countries to “use these new resources transparently and effectively.”

“Champion of global growth”

Summit leaders promised to try to supplement SDRs with “flexibility in debt and deficit ceilings,” but also urged countries to undertake “necessary reforms at the national level.”

Italian Prime Minister Mario Draghi, the former head of the European Central Bank, promised that the summit’s proposals would be supported by the group of G20 countries and “all the multilateral institutions in the world.”

Debt restructuring will take a big effort to help Africa, Draghi said.

Georgieva said there was “a very dangerous divergence between advanced economies and developing countries, especially Africa.”

French President Emmanuel Macron takes on African Development Bank President Akinwumi Adesina alongside Ivory Coast President Alassane Ouattara just before Tuesday’s inaugural summit session [Ludovic Marin/Reuters]

African economic growth was underway at just 3.2% this year, well behind the remaining 6% forecast for the rest of the world, he said.

The African Development Bank predicted that up to 39 million people could fall into poverty this year, with many African countries at risk of incurring debt due to the pandemic.

The summit welcomed a moratorium on public debt service agreed in April by the world’s leading lenders.

The summit came a day after a conference on Monday attended by several heads of state with the aim of gathering support for the Sudanese government.

Leaders attending Tuesday’s summit are also expected to discuss debt relief initiatives and how to reduce interest rates for the African private sector to boost investment and growth.

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