When Constantino Chiwenga, Zimbabwe's vice-president and health minister, suspended by-elections in October 2020 citing Statutory Instrument ... (SI) 225A as a means to curb Covid-19, many believed a new date would be set. Instead, the government has remained silent on the matter, with many wondering if this is truly a measure to control the pandemic, or a strategy by the ruling Zanu PF to stop the MDC Alliance from winning back seats it lost after the recall by its breakaway party, the MDC-T.
At the opening of the summit on financing of African economies, which was held in Paris on 18 May, Macron hammered out two words: ‘urgency’ and ‘ambition’ for the continent. A few hours later, when the time came to take stock of the situation, in front of the Eiffel Tower, it was a mixed bag of issues.
21 African heads of state and government travelled for the summit, as well as several heads of continental organisations (African Union, ADB, etc.) and international organisations (European Union, IMF, etc.).
The aim was to come up with a unified response to the unprecedented economic shock presented by the Covid-19 pandemic and establish a vast recovery plan for the continent – sort of like an ‘African New Deal’, as the participants described it.
In search of the “New Deal”
“This moment can be an opportunity to finally respond to the immense challenges that we did not want to fully address in previous years,” Macron said at the final press conference.
“The objective of this summit was twofold: to provide short-term responses and to launch a dynamic that can truly create this economic and strategic New Deal with the African continent,” said Macron. “I believe that we have succeeded in making progress on these two aspects. Of course, we cannot change the life of the African continent or relations between Africa and the rest of the world in one day and in one summit, but I believe that our discussions have shown a collective awareness, a change of mindset and the launch of a profound dynamic.”
At a time when most rich countries have already adopted massive financing plans worth hundreds of billions of euros, many fear that African economies will stall – with all the social and migratory consequences which that entails – if nothing is done to help them overcome the current crisis.
We now need to convince the others to make the same effort, especially the United States. However, no precise amount or timetable for these SDR reallocations has been communicated,” Macron said.
Hit hard economically and socially by the Covid-19 pandemic, Africa went into recession in 2020 after a quarter century of continuous growth. According to the IMF, up to $285bn in additional financing, over the period 2021-2025, would be needed for African countries to strengthen their response to the pandemic.
A “drop in the bucket”
To meet this huge financial challenge, one strategy was at the heart of debates at the ephemeral Grand Palais on the Champ de Mars: the IMF’s Special Drawing Rights (SDRs), which provides foreign currency to countries that need it, without creating additional debt.
The principle of a global issue of $650bn in SDRs by the IMF – agreed before this summit, thanks to the endorsement of the United States, last March – was confirmed.
But of this $650bn, only $33bn is earmarked for African countries, which could be made available to them as early as September. Why such a small amount, a ‘drop in the bucket’ as Macky Sall put it? Because SDRs are distributed according to the quotas of each country within the IMF. The largest share goes to the richest countries.
“This is too little and still insufficient,” Macron said at the end of the summit, hence the stated desire to reach a target of $100bn in SDRs for Africa in the coming months.
How can this be achieved? Through the reallocation of SDRs to the countries of the continent by the richest countries. “France is ready to do so, as is Portugal,” the French president said. “We now need to convince the others to make the same effort, especially the United States. However, no precise amount or timetable for these SDR reallocations has been communicated.”
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