IMF Urged to Boost Support for Africa Amid Overlapping Crises
Washington, D.C. – April 17, 2024
At the 2024 African Consultative Group (ACG) meeting with the International Monetary Fund (IMF) on Tuesday, Dr. Ernest Addison, Governor of the Bank of Ghana, called on the IMF to intensify its support for African countries grappling with multiple crises and a challenging global economic environment.
Speaking at the IMF headquarters in Washington, D.C., Dr. Addison emphasized the critical need for enhanced financial assistance and strategic policy flexibility to address the “complex challenges” that have subdued Africa’s post-pandemic recovery. High debt levels and persistent funding issues, he noted, have exacerbated income disparities and hindered sustainable, inclusive growth across the continent.
“The IMF’s role is indispensable in this context,” Dr. Addison stated, urging the fund to maintain and increase the concessionality of its lending facilities to low-income countries (LICs), particularly through the Poverty Reduction and Growth Trust (PRGT).
Highlighting the impact of global inflation and recent food crises triggered by the El Nino phenomenon, Dr. Addison also called for a replenishment of the Catastrophe Containment and Relief Trust (CCRT) to provide critical grant support.
He stressed the importance of closing financing gaps induced by climate and other global shocks, suggesting that the IMF intensify fundraising efforts under its resource mobilization initiatives.
The Governor also proposed greater collaboration between the IMF and the World Bank, particularly in aligning the Fund’s review of LIC facilities with the World Bank’s efforts to replenish its International Development Association (IDA) funds. This coordination, he argued, is essential for a holistic approach to supporting LICs.
Addressing the recent volatility in global markets, Dr. Addison advocated for keeping “all financing options on the table,” including a potentially “modest gold sale” by the IMF, leveraging currently favourable gold prices to strengthen its financial position.
Lastly, Dr. Addison urged for enhancements to the G20 Common Framework and leveraging the Global Sovereign Debt Roundtable to promote quicker, more transparent, and equitable debt resolutions. He highlighted the need for impactful changes in the Fund’s internal debt policies to ensure they meet their intended objectives.
The meeting underscored the ongoing dialogue between African nations and international financial institutions as they seek collaborative solutions to ensure stability and growth in one of the world’s most dynamically evolving regions.
Dr. Addison’s call for action reflects the broader concerns of African leaders regarding the adequacy of current global financial mechanisms to deal with unprecedented economic and environmental challenges.
