COVID-19: Finance Ministers canvass $100bn stimulus for African states
As the COVID-19 pandemic ravages the economy of many African countries and advanced economies, Africa would need not less than $100 billion economic stimulus to jump start its economies.
This was disclosed by African Finance Ministers as part of their decision at a virtual conference to exchange ideas on the efforts of their respective governments in dealing with social and economic challenges posed by COVID-19 pandemic.
The ministers, at the conference held recently, observed that the waivers of all interest payments estimated at $44billion for 2020, coupled with the possible extension of the waivers to the medium term, would provide immediate fiscal and liquidity windows to the governments in their efforts to combat the COVID-19 disease.
According to them, the interest payment waivers should also include interest payments on sovereign bonds. While agreeing on the need to consider waivers for principal and interest payments, the ministers also canvassed the use of existing facilities in the World Bank, International Monetary Fund (IMF), African Development Bank (ADB) and other regional institutions for fragile and exposed states.
They emphasised the need to support the private sector in order to protect about 30 million jobs, which they said, were currently at risk “particularly in the tourism and airline sectors across the continent”.
Focusing on other critical sectors, such as agriculture, imports and exports, pharmaceuticals and banking, the finance ministers said that all interest and principal payments on corporate debts, leases, extended credit facilities, refinancing schemes and guarantee facilities should be considered in waiving, restructuring and providing additional liquidity for the sectors in 2020.
The ministers also canvased the opening of a liquidity line to the private sector “so as to ensure the continuity of essential purchases and allow all the SMEs that were dependent on trade to continue to function”, the finance ministers said.
They also called for the opening of all borders posts worldwide particularly in Europe and the United States of America as part of the stimulus package for economic growth.
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