Ramaphosa supports AU call for debt ‘standstill’ during pandemic

President Cyril Ramaphosa said Africa was “encouraged in finding solutions to developing countries' debt sustainability and related issues” during the…

President Cyril Ramaphosa said Africa was “encouraged in finding solutions to developing countries’ debt sustainability and related issues” during the coronavirus pandemic as spelled out in a virtual meeting here.The South African leader said this during the virtual UN High Level Event on Financing for Development in the Era of Covid-19 and Beyond with G20 countries, the Bretton Woods institutions and the UN held on Thursday.

The participants are collaborating on the debt issue following the African Union’s call for a two-year “debt standstill” due to the impact of the Covid-19 pandemic which has devastated world economies, including those of African states.

“We support the allocation of more International Monetary Fund’s Special Drawing Rights to help central banks, the corporate sector and small and medium-sized businesses to withstand the shocks caused by the pandemic,” said Ramaphosa who is the AU chairperson.

He said South Africa, a member of the G20, endorsed UN Secretary General António Guterres’s call for the development of a comprehensive debt framework.

“This should start with an across-the-board debt standstill for countries unable to service their debts, followed by targeted debt relief and a comprehensive approach to structural issues in the international debt architecture to prevent defaults,” he said.

Guterres has called for a global response package amounting to at least 10 percent of the world’s gross domestic product. This means more than US$200 billion of additional support for Africa.

“We must also address the threat posed to the economic stability of developing countries by illicit financial flows, money laundering and corruption,” Ramaphosa said.

Ramaphosa also emphasised that no one should be left behind, noting that South Africa shared a collective responsibility to “not just uplift our respective countries and societies, but also those less resourced and less fortunate than us.”

Canadian and Jamaican Prime Ministers Justin Trudeau and Andrew Holness, respectively, hosted the virtual event.