Secretary-General Says Tackling ‘Crushing Debt’ Central to COVID-19 Responses, at Joint Meeting of Global Financial Bodies

Following are UN Secretary-General António Guterres’ remarks to the International Monetary Fund/World Bank high-level meeting on “Mobilizing with Africa”, in New York today:

I thank the African Union, International Monetary Fund (IMF) and World Bank Group for bringing us together to Mobilize with Africa.  Let me begin by expressing my total solidarity with the people and Governments of Africa in the epic global effort to tackle the COVID-19 pandemic.

I commend your early action.  The African Union and the African continent have shown unity and leadership — two of the scarcest commodities at the present time.

We need to target every ounce of energy against COVID-19.  We know this virus will spread like wildfire and there are no firewalls.  And as with the climate crisis, the African continent could end up suffering the greatest from a crisis that is not of its making.

And let’s be clear, this is far more than a health crisis.  It is a human crisis.  It is not just a health pandemic.  It is a jobs pandemic.  A humanitarian pandemic.  A development pandemic.

In Africa, households and businesses were suffering liquidity challenges and other pressures even before the virus got a toehold on the continent.  The development emergency had already hit before the health emergency, but now countries will need to battle both — with millions more Africans plunged into poverty.  Meanwhile, already unacceptable levels of inequalities are growing, fragility increasing, commodity prices declining and hard-won development gains are under threat.

To help address the devastating economic and social consequences, I have been, since the beginning, asking for a comprehensive global response package amounting to a double-digit percentage of global gross domestic product (GDP).  This, by the way, is assumed by several developed countries with their own domestic programmes.  For Africa, that means more than $200 billion.

To get there, we must mobilize all partners.  I commend swift actions by the IMF and World Bank Group to support member countries and the strong commitment of both the International Monetary and Financial Committee and the Development Committee to enhance access to facilities and tools.

But, we need greater resources for the IMF, including through the issuance of special drawing rights, and enhanced support for the World Bank Group and other international financial institutions and bilateral mechanisms.  Alleviating crushing debt is absolutely crucial.

I welcome the Group of 20 steps, including the suspension of debt service payments for all International Development Association (IDA) countries.  That’s a start.  But, the severity of the crisis demands more.

Many other developing countries are highly vulnerable and already in debt distress — or will become distressed with the global recession.  In Africa, the average debt-to-GDP ratio has increased from 39.5 per cent in 2011, to 61.3 per cent in 2019.

In my view, we need a comprehensive debt framework with three phases.

First, an across-the-board debt standstill for all those developing countries that have no access to financial markets and cannot service their debt.  Second, more comprehensive options towards debt sustainability with instruments such as debt swaps and a debt mechanism for the Sustainable Development Goals.  And third, addressing structural issues in the international debt architecture to prevent defaults leading to prolonged financial and economic crises.

In all our efforts, we must focus on the most vulnerable and ensuring that the rights of all people are protected.

That means securing and building on progress on gender equality and women’s rights — and emphasizing the need for women’s leadership on COVID-19 recovery and response.  It means focusing on the impact of the virus on children, persons with disabilities and other vulnerable populations.

Refugees, displaced persons and others caught up in conflict face special vulnerabilities — this is why I appealed for a global ceasefire.  It is also why the United Nations has launched its Global Humanitarian Response Plan, much of which is devoted to the African continent, and that must be fully funded by the international community.

I welcome African commitment to ensure coordination and humanitarian access.  The United Nations system supply chain network has started its “solidarity flights” to distribute vital medical supplies across the continent.

Finally, we are also working closely with the World Health Organization (WHO) and others to build an international coalition to advance a vaccine as soon as possible.  My core message is simple:  That vaccine must be available and affordable for everyone, everywhere.  It must be considered a global public good.

Exceptional times demand exceptional solidarity.  One of the most important tests of that global solidarity is by mobilizing with Africa for shared prosperity of the continent and the world.

Rest assured, my actions will continue to echo and reinforce the call of so many African leaders who have rightly said:  “Only victory in Africa can end the pandemic everywhere.”